Will they never learn? Never put anything in an email that you wouldn’t write on a postcard. After all the email-related rows in politics over the last decade, you'd have thought that the Number Ten ‘director of strategy’, Damian McBride, and the Labour blogger, Derek Draper, would know by now that if you want to talk about something sensitive, lift the phone. Email is not secure.
Remember Labour spin-doctor Jo Moore resigning after suggesting that 11 September was a good day to “bury” bad news? Or Ruth Turner’s emails about Lord Levy during cash for honours? I don’t know how Damian McBride’s puerile smears of senior Tories found their way into the hands of the right-wing blogger Pall Staines aka Guido Fawkes. But it comes as no surprise tha they did. There are people in all big organisations who know how to hack into email. Just ask the home secretary, Jacquie Smith, whose data-retenion law comes into force this week, requiring internet service providers to retain all email traffic so that it can be monitored.
Of course, McBride - one of Gordon Brown’s closest aides who earns a six figure salary - should never have been trading salacious gossip with someone like Derek Draper, a former Mandelson aide who resigned over the cash-for-access scandal in 1998. The only mitigation is that politicians and journalists do this all the time. The stories about the Tory shadow chancellor, George Osborne, spending time with a drug taking prostitute are well known - so well known that they were published in the News of the World in 2005. David Cameron admitted to having visited a sexual disease clinic when he was a student - along with half the male population. The story about the Tory backbencher, Nadine Dorries, leaving a sex aide in a hotel room after a night of passion is typical of the untrue stories that circulate all the time.
Let me give you an example closer to home. In the ten years or so I spent in the Westminster Lobby, the most common piece of gossip concerned Gordon Brown’s alleged homosexuality. Whenever hacks gathered in the liquid dungeons of the Palace, lurid stories were exchanged about the extreme sexual practices allegedly enjoyed by the then chancellor-to-be. So far as I could tell the only basis for these tales was that Brown wasn’t married (then) and that a number of his aides, including Nick Brown the then chief whip, were gay. But the stories were so detailed and elaborate that it was hard not to believe that some of them must be true. This is exactly the kind of material that Brown’s closest aide was seeking to feed into the proposed “Red Flag” website - albeit about Tories.
The other great rumour when I was in Westminster was that the Prime Minister, John Major, had been having an affair with a Number Ten caterer. Everyone knew it was true, until the New Statesman unwisely ran with the story, in 1993, and was nearly bankrupted when Major sued. The amazing thing, of course, was that John Major was actually having an affair with the Tory minister Edwina Currie. This had been going on for years under our very noses, but no one in Westminster twigged. The truth is that journalists think they know what is going on in the inside of politics, but they don’t know the half of it, or even the quarter of it.
But why has all this scum risen to the surface now? Well, because political journalism is entering a new age, the age of the blog - an ugly word for an ugly trade. The internet is littered now with badly written and ill-informed home-made publications by opinionated nerds whose skill with digital technology has suddenly given them the edge over the old media - like, er, me. This new frontier of hackery is not subject to the same standards of accuracy, taste, style and legality that newspapers like the Herald are subject to. It is fashionable to condemn the “dead tree press” for being unreliable and sensationalist, but we are like academic research journals compared to the stuff on the web.
For reasons no one has been able to fully explain, the political right has been adept at this new kind of journalism, led by Guido Fawkes and Iain Dales Diary. The politics of bloggery is intensely personal and Fawkes and Dale had been gunning for McBride and Draper for months over the latter’s suggestion that Dale and Fawkes were racist. This is largely because Dale defended Carol Thatcher after hee “golliwog” gaffe. Fawkes got hold of the offensive communications between McBride and Draper and gave them to the News of the World without, he insists, asking for any money. McBride tried to laugh it off as harmless banter, but when the full text became available, he had to resign.
This was because it was clear that Draper intended to use McBride's “brilliant” Tory sex smears in a new blog he was hoping to set up to counter Fawkes, called “Red Flag”. The emails discussed how best to “sequence” the stories to give them maximum effect, and McBride had even written them in a sub-Private Eye style, hinting at impropriety without actually spelling it out. Of course, had there been a jot or scintilla of substance to any of these tales they would have been published already in Private Eye, which remains the number one organ of salacious gossip from politics and journalism. But it has been sued so often that it is now one of the most reliable publications on the planet. And of course it isn’t on the internet.
Why is the new journalism of the web so nasty? I really don’t know. Blogging should have been the opportunity for all sorts of interesting people from all walks of life to start provoking debate with original ideas. Whistle-blowers had a new notice board on which to post information the authorities don’t want us to know about. Instead the blogosphere has been hijacked by sociopathic egos with extreme views who spend most of their time attacking each other. There is no quality control on the web and no editorial discretion. And since nothing on the web can be longer than a couple of hundred words, argument and insight has been replaced by bark and bite. Bloggers don’t write, they ejaculate. But then, I’m just a boring old hack so what do I know.
Monday, April 13, 2009
Unemployment is the real crunch
Last week’s record rise in unemployment had been so well forecast that it passed with relatively little comment. Yet, by any standards, this - rather than the death-throws of the banks - is the real story of the financial crisis. It is only through mass unemployment that the abstract issues of derivatives, sub-prime, quantitative easing and so on become a hard reality on the ground: three and a half million unemployed by 2010.
When you consider the cost in ruined lives, you have to wonder at our scale of priorities. For, within 24 hours the news cycle had turned and we were back to talking about banking regulation and chasing another mouthy Labour minister, the Solicitor General Vera Baird, for talking about green shoots of recovery. A rescue was being demanded for a minor Scottish building society which had gone bust through irresponsible property lending. Where is the rescue for the unemployed, for the real economy?
Our entire political system has become so locked on to the fate of the banks, we seem to have forgotten that the economy is made of people not statistics, and that the object of economic policy should be to secure the most stable living standards for the largest number of them. We have handed some £1.3 trillion to the banking system so far - a sum equivalent to the entire GDP of this nation - in a futile rescue of a discredited financial system. Recovery is conceived almost entirely in terms of financial indicators. The government wants to see Libor fall, house prices stabilise, inflation rise, banks return to profitability. This is to get things upside down. These statistics are of secondary importance to the welfare of the community.
Just consider: the number of people claiming unemployment benefit rose last month by the highest figure ever recorded - 138,000. These are people who have gone from living secure lives on relatively comfortable incomes, to near destitution. Jobseekers allowance in Britain is a miserable £60.50 a week - with no golden parachutes available. Few of us can imagine living on so little. Indeed, no one is seriously expected to live on jobseekers allowance, which is in reality a device to force people into taking whatever job is available, irrespective of their skills. It is a punitive benefit which assumes that those not working are essentially workshy.
So the first thing that will happen is that the newly unemployed - as well as the 2 million already on the dole - will go into even greater debt, as more people take out unsecured loans on credit cards to make ends meet. It is boom time for the other shadow banking system: the loan sharks, pawnbrokers and other purveyors of doorstep debt.. This is the next financial scandal. In around 2 years the Financial Services Authority will be issuing a damning report on its own failure to control unsecured lending.
Unemployment means immense human hardship and creates social problems which endure for decades. One of the most worrying figures from last week - again, largely ignored - is that 40% of the unemployed are under 25 years of age. This is creating a generational dynamic which will cause social harm long after the recession ends. Crime will rise, more families will break up; there will be more teenage pregnancies, more domestic violence, more drug addiction, more mental illness, more heart disease,.. I could of course quantify these in hard financial statistics like the cost in NHS provision - but I refuse to go down that route of fiscal utilitarianism. We should not be focusing merely on the financial cost of unemployment to the exchequer, but on the profound damage to the fabric of society.
Historians will look back with astonishment at the callousness and stupidity of policy-makers in this crisis - not just because they allowed Northern Rock to lend £800m of its “suicide mortgages” even after nationalisation, but because they consistently put the welfare of the banks above the welfare of society. It doesn’t even make economic sense. As we now know, much of the public money that has been handed to the City in loans, guarantees and capital injections, has gone overseas and into paying down banking debt. There has been no appreciable recovery in bank lending to business, as the squeals and cries from the private sector confirm.
A rational economic policy would have concentrated first on creating economic activity by the most direct routes: through spending on public works like houses and schools, and through increasing the financial resources of the least well off, who can be relied upon to spend the money in the shops rather than hoard it in vaults. Only by promoting employment, the creation of real value in goods and services, can resources be generated to revive the financial system - though hopefully on very different terms from the past. It is so obvious that I despair at having to keep saying it. The government appears to believe that it is only by creating debt that an economy flourishes. The entire thrust of policy is to encourage more lending through near zero interest rates and through printing money. This is utter madness.
What we are seeing is a collapse of work as wealth is drained from the productive economy. The Bank of England last week noted that labour costs per employee are falling fast as companies impose a wage freeze and introduce schemes to cut pay. The government is congratulating itself on the “flexibility” of the UK labour market, but it shouldn’t. What plunging labour cost indicate is that the real economy is actually sliding into depression. When incomes decline, shops close and manufacturers go bust - it is one of the most savage feedback loops in economics, and it is only our fixation on abstract financial indicators that prevents us from seeing it.
Printing money in this context will lead inexorably to stagflation - industrial shrinkage overlaid with rising prices and crippling debt. As commodity prices recover, and the pound sinks, British imports will increase in cost and our debt-laden and idle economy will be impoverished more rapidly than anyone can imagine. Savings will be destroyed by rampant inflation while more businesses close. With borrowing heading for £100bn this year, and perhaps three times that in future years, the British state is itself facing insolvency. There will be massive job-shedding from the public sector.
But the government appears interested solely in trying to halt the slide in house prices by boosting borrowing. This is politically suicidal. No Labour government can win an election against a backdrop of over 3 million unemployed. We learned that exactly thirty years ago when the Tories launched their 1979 election campaign on the most successful slogan in political advertising history: “Labour isn’t Working”.
When you consider the cost in ruined lives, you have to wonder at our scale of priorities. For, within 24 hours the news cycle had turned and we were back to talking about banking regulation and chasing another mouthy Labour minister, the Solicitor General Vera Baird, for talking about green shoots of recovery. A rescue was being demanded for a minor Scottish building society which had gone bust through irresponsible property lending. Where is the rescue for the unemployed, for the real economy?
Our entire political system has become so locked on to the fate of the banks, we seem to have forgotten that the economy is made of people not statistics, and that the object of economic policy should be to secure the most stable living standards for the largest number of them. We have handed some £1.3 trillion to the banking system so far - a sum equivalent to the entire GDP of this nation - in a futile rescue of a discredited financial system. Recovery is conceived almost entirely in terms of financial indicators. The government wants to see Libor fall, house prices stabilise, inflation rise, banks return to profitability. This is to get things upside down. These statistics are of secondary importance to the welfare of the community.
Just consider: the number of people claiming unemployment benefit rose last month by the highest figure ever recorded - 138,000. These are people who have gone from living secure lives on relatively comfortable incomes, to near destitution. Jobseekers allowance in Britain is a miserable £60.50 a week - with no golden parachutes available. Few of us can imagine living on so little. Indeed, no one is seriously expected to live on jobseekers allowance, which is in reality a device to force people into taking whatever job is available, irrespective of their skills. It is a punitive benefit which assumes that those not working are essentially workshy.
So the first thing that will happen is that the newly unemployed - as well as the 2 million already on the dole - will go into even greater debt, as more people take out unsecured loans on credit cards to make ends meet. It is boom time for the other shadow banking system: the loan sharks, pawnbrokers and other purveyors of doorstep debt.. This is the next financial scandal. In around 2 years the Financial Services Authority will be issuing a damning report on its own failure to control unsecured lending.
Unemployment means immense human hardship and creates social problems which endure for decades. One of the most worrying figures from last week - again, largely ignored - is that 40% of the unemployed are under 25 years of age. This is creating a generational dynamic which will cause social harm long after the recession ends. Crime will rise, more families will break up; there will be more teenage pregnancies, more domestic violence, more drug addiction, more mental illness, more heart disease,.. I could of course quantify these in hard financial statistics like the cost in NHS provision - but I refuse to go down that route of fiscal utilitarianism. We should not be focusing merely on the financial cost of unemployment to the exchequer, but on the profound damage to the fabric of society.
Historians will look back with astonishment at the callousness and stupidity of policy-makers in this crisis - not just because they allowed Northern Rock to lend £800m of its “suicide mortgages” even after nationalisation, but because they consistently put the welfare of the banks above the welfare of society. It doesn’t even make economic sense. As we now know, much of the public money that has been handed to the City in loans, guarantees and capital injections, has gone overseas and into paying down banking debt. There has been no appreciable recovery in bank lending to business, as the squeals and cries from the private sector confirm.
A rational economic policy would have concentrated first on creating economic activity by the most direct routes: through spending on public works like houses and schools, and through increasing the financial resources of the least well off, who can be relied upon to spend the money in the shops rather than hoard it in vaults. Only by promoting employment, the creation of real value in goods and services, can resources be generated to revive the financial system - though hopefully on very different terms from the past. It is so obvious that I despair at having to keep saying it. The government appears to believe that it is only by creating debt that an economy flourishes. The entire thrust of policy is to encourage more lending through near zero interest rates and through printing money. This is utter madness.
What we are seeing is a collapse of work as wealth is drained from the productive economy. The Bank of England last week noted that labour costs per employee are falling fast as companies impose a wage freeze and introduce schemes to cut pay. The government is congratulating itself on the “flexibility” of the UK labour market, but it shouldn’t. What plunging labour cost indicate is that the real economy is actually sliding into depression. When incomes decline, shops close and manufacturers go bust - it is one of the most savage feedback loops in economics, and it is only our fixation on abstract financial indicators that prevents us from seeing it.
Printing money in this context will lead inexorably to stagflation - industrial shrinkage overlaid with rising prices and crippling debt. As commodity prices recover, and the pound sinks, British imports will increase in cost and our debt-laden and idle economy will be impoverished more rapidly than anyone can imagine. Savings will be destroyed by rampant inflation while more businesses close. With borrowing heading for £100bn this year, and perhaps three times that in future years, the British state is itself facing insolvency. There will be massive job-shedding from the public sector.
But the government appears interested solely in trying to halt the slide in house prices by boosting borrowing. This is politically suicidal. No Labour government can win an election against a backdrop of over 3 million unemployed. We learned that exactly thirty years ago when the Tories launched their 1979 election campaign on the most successful slogan in political advertising history: “Labour isn’t Working”.
Budget 2009 - Darling's Dilemma
All talk of green shoots is verboten right now on the government benches - it’s all hair shirts and austerity on the eve of Chancellor Darling’s second budget next Wednesday. But outside government there’s no shortage of people who do claim to be seeing signs of recovery in the economy. Most of them are the usual suspects - like the estate agents, who were forecasting a recovery in the housing market almost before prices started to fall. But with stock exchanges rebounding by 22% and the banking sector apparently stabilising, there is bound to be a period of modest recovery at least in the financial markets. British exports are up and some economists, like the Centre for Economic and Business Research, say house prices have only another 10% to fall.
The trouble is that this may be good news outside the Treasury, but bad news within it. For, if there is any sign of recovery, the first thing the government and the Bank of England ought to do is increase taxes and interest rates to sort out the deficit. This would halt the apparent recovery in its tracks, which will make people very annoyed. “Why is the government blocking recovery”the British Chambers of Commerce and the TUC will complain, just when people need to be helped back to work? Indeed, unemployment will be rising just at the moment the government puts its foot on the brake.
Which probably guarantees that it won’t. This is where the interests of economics and politics collide. There is no doubt that the British finances are dire: the Institute For Fiscal Studies says that the government is going to have raise taxes or cut spending by £20bn a year over the next five years to fix the holes caused by collapsing tax revenues and increases in welfare payment to the unemployed. The final figure will almost certainly be more than this because the IFS is not taking fully into account the cost of the various bank rescues and toxic asset buyouts which the government has embarked upon. £1.3 trillion has been put on the table and while that won’t all disappear into the banking black hole, a lot of it surely will.
Taking all this money out of the economy now would reduce demand and provoke a further downturn on the eve of the next general election. Increased taxes would make people even more reluctant to spend in the shops than they are now. Increased interest rates would kill the expected recovery in the housing market. The value of sterling might rise, which would damage exports, and of course there would have to be big cuts in the public sector, which would add to unemployment. This is very difficult medicine for an unpopular government. From a narrow political point of view, doing nothing to impede economic revival is not so much a no-brainer as a full frontal lobotomy.
However, there had been indications that the Chancellor, Alistair Darling, was minded to start increasing taxes sooner rather than later. He has of course already made clear there is to be a new 45% tax rate on people earning over £150,000. He has been warning that the economy is in a bad way and that difficult choices will have to be made. Alistair Darling has made a virtue out of being the ‘feel-bad’ chancellor, never knowingly optimistic, and he does not want to go down in history as the second Labour chancellor to have to call in the IMF to rescue a bankrupt Britain. The first having been Denis Healey in 1976.
But equally, Gordon Brown does not want to be a prime minister who has never won a general election. It is inconceivable that he would allow Darling to take any actions that would jeopardise Labour’s prospects in the general election that must be fought before May of next year. Electoral success desperately needs a recovery, or the appearance of one. So, on the eve of this week’s budget, we can expect much happy talk of stimulus, electric cars house building, help for home buyers. There will be promises to do “whatever it takes” to get the economy moving again and to hang with the public finances.
The Chancellor has been receiving deputation's from businessmen, trades unionist and Labour backbenchers all urging him, with the PM’s implicit backing, to stoke the economy with more borrowed cash. It all sounds very plausible: invest now for the upturn; don’t allow skills to wither on the dole; boost confidence and house prices. It’s only money, after all, and it can all be paid back later when the economy recovers...
But the ugly reality is that Britain’s financial predicament is much worse than it appears. Fiscal stimulus implies that there is something to stimulate, not a flat-lining corpse. There needs to be huge structural change in the UK economy to address the ageing population and our over-dependence on debt and finance. The unfunded public sector pensions bill alone amounts to £1trillion. Meanwhile, private debt of £1.5 trillion will have to be paid back. The cost of 3.3 million unemployed will also be eye watering. The liabilities of the nationalised banks are huge: RBS alone has liabilities equivalent to 150% of GDP. Add all this together it’s not hard to get a very big number indeed, which is why many international financiers have taken to calling London “Reykjavik on Thames”.
Of course, this doesn’t all have to be paid at once, and much of it may never have to be paid at all. We have to assume that even financial toxic wasted dumps like RBS will eventually recover. But let’s be absolutely clear, whether on the right of the political spectrum or the left, the inescapable priority of British politics for the next decade will be winning the war against debt. With these huge financial overhangs, the merest hint that the government is not taking steps to repair the finances of he state would lead to a loss of confidence in the UK economy followed by a letter to the IMF. Already, the cost of insuring against a UK default on the derivatives market has been increasing alarmingly. Welcome to New Britain.
The trouble is that this may be good news outside the Treasury, but bad news within it. For, if there is any sign of recovery, the first thing the government and the Bank of England ought to do is increase taxes and interest rates to sort out the deficit. This would halt the apparent recovery in its tracks, which will make people very annoyed. “Why is the government blocking recovery”the British Chambers of Commerce and the TUC will complain, just when people need to be helped back to work? Indeed, unemployment will be rising just at the moment the government puts its foot on the brake.
Which probably guarantees that it won’t. This is where the interests of economics and politics collide. There is no doubt that the British finances are dire: the Institute For Fiscal Studies says that the government is going to have raise taxes or cut spending by £20bn a year over the next five years to fix the holes caused by collapsing tax revenues and increases in welfare payment to the unemployed. The final figure will almost certainly be more than this because the IFS is not taking fully into account the cost of the various bank rescues and toxic asset buyouts which the government has embarked upon. £1.3 trillion has been put on the table and while that won’t all disappear into the banking black hole, a lot of it surely will.
Taking all this money out of the economy now would reduce demand and provoke a further downturn on the eve of the next general election. Increased taxes would make people even more reluctant to spend in the shops than they are now. Increased interest rates would kill the expected recovery in the housing market. The value of sterling might rise, which would damage exports, and of course there would have to be big cuts in the public sector, which would add to unemployment. This is very difficult medicine for an unpopular government. From a narrow political point of view, doing nothing to impede economic revival is not so much a no-brainer as a full frontal lobotomy.
However, there had been indications that the Chancellor, Alistair Darling, was minded to start increasing taxes sooner rather than later. He has of course already made clear there is to be a new 45% tax rate on people earning over £150,000. He has been warning that the economy is in a bad way and that difficult choices will have to be made. Alistair Darling has made a virtue out of being the ‘feel-bad’ chancellor, never knowingly optimistic, and he does not want to go down in history as the second Labour chancellor to have to call in the IMF to rescue a bankrupt Britain. The first having been Denis Healey in 1976.
But equally, Gordon Brown does not want to be a prime minister who has never won a general election. It is inconceivable that he would allow Darling to take any actions that would jeopardise Labour’s prospects in the general election that must be fought before May of next year. Electoral success desperately needs a recovery, or the appearance of one. So, on the eve of this week’s budget, we can expect much happy talk of stimulus, electric cars house building, help for home buyers. There will be promises to do “whatever it takes” to get the economy moving again and to hang with the public finances.
The Chancellor has been receiving deputation's from businessmen, trades unionist and Labour backbenchers all urging him, with the PM’s implicit backing, to stoke the economy with more borrowed cash. It all sounds very plausible: invest now for the upturn; don’t allow skills to wither on the dole; boost confidence and house prices. It’s only money, after all, and it can all be paid back later when the economy recovers...
But the ugly reality is that Britain’s financial predicament is much worse than it appears. Fiscal stimulus implies that there is something to stimulate, not a flat-lining corpse. There needs to be huge structural change in the UK economy to address the ageing population and our over-dependence on debt and finance. The unfunded public sector pensions bill alone amounts to £1trillion. Meanwhile, private debt of £1.5 trillion will have to be paid back. The cost of 3.3 million unemployed will also be eye watering. The liabilities of the nationalised banks are huge: RBS alone has liabilities equivalent to 150% of GDP. Add all this together it’s not hard to get a very big number indeed, which is why many international financiers have taken to calling London “Reykjavik on Thames”.
Of course, this doesn’t all have to be paid at once, and much of it may never have to be paid at all. We have to assume that even financial toxic wasted dumps like RBS will eventually recover. But let’s be absolutely clear, whether on the right of the political spectrum or the left, the inescapable priority of British politics for the next decade will be winning the war against debt. With these huge financial overhangs, the merest hint that the government is not taking steps to repair the finances of he state would lead to a loss of confidence in the UK economy followed by a letter to the IMF. Already, the cost of insuring against a UK default on the derivatives market has been increasing alarmingly. Welcome to New Britain.
Sunday, April 12, 2009
I fought the law and the law made very loud noise
It’s been a long road from the battle of Orgreave coke depot during the miners strike twenty five years ago to the battle of Kingsnorth power station in Kent last year. Instead of horses and baton charges, the police at Kingsnorth reportedly used the Clash and Wagner. Demonstrators at the climate camp were beaten over the head with high volume music, including tracks like “I Fought the Law and the Law Won” and “The Ride of the Valkyries”.
Depriving the protesters of sleep is supposed to make them easier to control. according to PC Plod’s manual on psychological operations. But many protesters aren’t that bothered about sleep and might've rather welcomed the play list of punk classics. I mean, isn’t that what young people do these days: gather in fields to gyrate to highly amplified popular music? It’s like a return to the free festival ethos pre-Glastonbury.
Come to think of it, shouldn’t the police really arrest themselves under the 1994 Criminal Justice And Public Order Act for organising an illegal rave? You can’t just set up a massive sound system in the middle of the countryside.you know. Waking the dead. Young people from miles around would be turning up in crumbling buses accompanied by grimy children and dogs on string. Asking people if they’re sorted for E’s and Wizz. Though with all that glow-in-the-dark clothing I suppose the officers would be well sorted for a 1990s rave. Smiley faces, flashing lights and funny helmets - it’s all there.
Mind you,the demonstrators probably wouldn’t want the music policy dictated to them by the police, They’d set up their own sound system and use Spotify to download suitably rebellious tracks like Rolling Stones’: “Street Fighting Man”; Kaiser Chiefs’: “We Are The Angry Mob”; Clash’s “White Riot”; Bob Marley’s: “Get Up Stand Up”. Queen’s ”;‘I Want to Break Free”, Billy Bragg’s: “World Turned Upside Down” and Eric Clapton’s: “I Shot The Sheriff”,
The police would have to respond in kind with painful antipersonnel lyrics like the Police’s: “Don’t Stand So Close to Me” and “I’ll be Watching You”. This would be followed by excruciating novelty singles such as “Shudduppa ya Face” and ‘Laughing Gnome” before mopping up the hard core of demonstrators with with a medley of sixties classics including “I can see for Miles” “Get Back” “The Harder They Come” . “You’re Going Down”. “Folsom Prison Blues” and “Chains”.
The climate campers might be knocked down, but they’d get up again, because they’re never going to keep them down. The're trying to stop a coal fired power station incinerating the planet so musical hostilities would resume with “Heatwave” followed by “A Hard Rain’s Gonna Fall”, and “It’s the End of the World as We Know it”. (ok that’s enough silly songs. Ed).
Depriving the protesters of sleep is supposed to make them easier to control. according to PC Plod’s manual on psychological operations. But many protesters aren’t that bothered about sleep and might've rather welcomed the play list of punk classics. I mean, isn’t that what young people do these days: gather in fields to gyrate to highly amplified popular music? It’s like a return to the free festival ethos pre-Glastonbury.
Come to think of it, shouldn’t the police really arrest themselves under the 1994 Criminal Justice And Public Order Act for organising an illegal rave? You can’t just set up a massive sound system in the middle of the countryside.you know. Waking the dead. Young people from miles around would be turning up in crumbling buses accompanied by grimy children and dogs on string. Asking people if they’re sorted for E’s and Wizz. Though with all that glow-in-the-dark clothing I suppose the officers would be well sorted for a 1990s rave. Smiley faces, flashing lights and funny helmets - it’s all there.
Mind you,the demonstrators probably wouldn’t want the music policy dictated to them by the police, They’d set up their own sound system and use Spotify to download suitably rebellious tracks like Rolling Stones’: “Street Fighting Man”; Kaiser Chiefs’: “We Are The Angry Mob”; Clash’s “White Riot”; Bob Marley’s: “Get Up Stand Up”. Queen’s ”;‘I Want to Break Free”, Billy Bragg’s: “World Turned Upside Down” and Eric Clapton’s: “I Shot The Sheriff”,
The police would have to respond in kind with painful antipersonnel lyrics like the Police’s: “Don’t Stand So Close to Me” and “I’ll be Watching You”. This would be followed by excruciating novelty singles such as “Shudduppa ya Face” and ‘Laughing Gnome” before mopping up the hard core of demonstrators with with a medley of sixties classics including “I can see for Miles” “Get Back” “The Harder They Come” . “You’re Going Down”. “Folsom Prison Blues” and “Chains”.
The climate campers might be knocked down, but they’d get up again, because they’re never going to keep them down. The're trying to stop a coal fired power station incinerating the planet so musical hostilities would resume with “Heatwave” followed by “A Hard Rain’s Gonna Fall”, and “It’s the End of the World as We Know it”. (ok that’s enough silly songs. Ed).
Dead Cat Bounce - and other animals
I’ve never actually seen a dead cat bounce, so I don’t know if its trajectory resembles that of the stock market in a brief rebound such as last week’s. But the financial world is very fond of these rather brutal animal metaphors. “Bull markets” are so called because when bulls attack they toss their victims up in the air. Bears, on the other hand, beat down with their paws, hence “bear market”. Leaves you with the image of a cat being tossed about by bulls and bears as they beat it to death. Which is pretty much how you feel if you have your pension invested in the stock market.
“Stags” are aggessive speculators who “flip” or buy and sell undervalued shares before anyone notices. And the slump has added more exotic creatures to the financial bestiary, like “vulture funds” - which pick over the carrion left lying around by the bears. And my special favourite, “bottom feeders”, City slang for investors who discretely buy shares at the bottom of a bear market. Yum.
Bottom feeders are no doubt hoping that “quantitiative easing” will get the market moving. QE, is a vaguely medical metaphor designed to divert attention from what the Bank of England is actually doing, which is printing money to encourage inflation. The Bank would rather you thought of gentle laxatives clearing the blockage. Another diversionary image is “tax haven” designed to make you think of poor harassed capitalists seeking asylum from the big bad taxman. In fact tax havens run tax avoidance schemes where “shadow banks” “speculate” on “derivatives” dreamed up by “rocket scientists”.
Actually, many rocket scientists - physicists and mathematicians - really were attracted to work in the financial world in the 80s and 90s by the big rewards to for devising ever more complex ways of making money. Like the infamous “Black-Scholes option-pricing model”, which was supposed to guarantee profits in any market, but, er, didn’t. It's now called the "black holes" model.
"Hedge funds" - as in hedging bets - created “short sellers” who borrow shares in a company they think is about to collapse and then sell them back at a lower price making a profit on the difference. “Naked short sellers” don’t even borrow the shares in the first place. Then there are wonderfully opaque concepts like “backwardation”, a market in which futures prices are higher in the early delivery months, not to be confused with “contango” where prices are higher in the later delivery months. Wake up at the back there! You’ll be tested on this.
There is “balloon maturity”, and “boning” which is charging a lot more than an asset is worth. “Bootstrapping” and the “barbell strategy” are more or less what they sound like. Which brings us to the most important financial term of all, which applies to all of the above, namely: “b@llocks”.
“Stags” are aggessive speculators who “flip” or buy and sell undervalued shares before anyone notices. And the slump has added more exotic creatures to the financial bestiary, like “vulture funds” - which pick over the carrion left lying around by the bears. And my special favourite, “bottom feeders”, City slang for investors who discretely buy shares at the bottom of a bear market. Yum.
Bottom feeders are no doubt hoping that “quantitiative easing” will get the market moving. QE, is a vaguely medical metaphor designed to divert attention from what the Bank of England is actually doing, which is printing money to encourage inflation. The Bank would rather you thought of gentle laxatives clearing the blockage. Another diversionary image is “tax haven” designed to make you think of poor harassed capitalists seeking asylum from the big bad taxman. In fact tax havens run tax avoidance schemes where “shadow banks” “speculate” on “derivatives” dreamed up by “rocket scientists”.
Actually, many rocket scientists - physicists and mathematicians - really were attracted to work in the financial world in the 80s and 90s by the big rewards to for devising ever more complex ways of making money. Like the infamous “Black-Scholes option-pricing model”, which was supposed to guarantee profits in any market, but, er, didn’t. It's now called the "black holes" model.
"Hedge funds" - as in hedging bets - created “short sellers” who borrow shares in a company they think is about to collapse and then sell them back at a lower price making a profit on the difference. “Naked short sellers” don’t even borrow the shares in the first place. Then there are wonderfully opaque concepts like “backwardation”, a market in which futures prices are higher in the early delivery months, not to be confused with “contango” where prices are higher in the later delivery months. Wake up at the back there! You’ll be tested on this.
There is “balloon maturity”, and “boning” which is charging a lot more than an asset is worth. “Bootstrapping” and the “barbell strategy” are more or less what they sound like. Which brings us to the most important financial term of all, which applies to all of the above, namely: “b@llocks”.
Margaret Thatcher. My Part In Her Downfall
As with the assassination of John F. Kennedy, everyone of a certain age remembers where they were the morning after Margaret Thatcher was elected prime minister thirty years ago. I was a university research student on loan to the BBC and scheduled to join an occupation of the site of the proposed Torness nuclear power plant in East Lothian - an appropriately lost cause for the day that marked the Left’s greatest post war defeat.
Demonstrators and journalists swapped gallows humour - “Chile this morning, isn’t it” - sensing that, with the election of the right-wing housewife superstar, things really had changed. None of us realised quite how much. Margaret Thatcher was far more of a revolutionary than any of the anti-capitalists at Torness. She changed Britain, and the world, and altered the way we think about politics and society. Love her or loathe her, we are all Thatcher’s children.
There was an inevitability about the Tory victory in 1979. Nothing was working. The country had just emerged from the Winter of Discontent, as the tabloids dubbed the great public sector strikes when “the dead lay unburied and rubbish uncollected in the streeets” - allegedly. What was certainly true was that the Labour prime minister, James Callaghan had made a disastrous decision in delaying a general election which he would probably have won in autumn 1978. By April 1979 Labour was forced to fight a campaign in the teeth of rising unemployment and industrial strife largely caused by Callaghan’s own public sector cuts. Curiously, Gordon Brown seems to have opted for much the same electoral strategy today.
The Tories deployed the most succesful advertising campaign in election history: “Labour Isn’t Working”. The dole queue in the Saatchi and Saatchi poster was in fact a photoshopped line of Hendon Young Conservatives - not many people know that. Nor did people know that under Margaret Thatcher, unemployment was about to rise to levels not seen in Britain since the 1930s, as Britain plunged into the deepest manufacturing recession since the war. Unemployment rose over three million and devastated Scotland's industrial communities. “Bathgate no more, Linwood no more...” sang The Proclaimers, as Scotland experienced the kind of social chaos that was to hit Russia in the 1990s. We’re still living with the legacy today in the high rates of heart disease, depression and alcoholism in West Central Scotland.
But Scotland was never high on Margaret Thatcher’s priority list. Her horizons were and as wide as the world as deep as history. She wanted to “abolish socialism” at home and defeat communism abroad. Incredibly, she arguably did both, and at the same time gave her name to a new “ism”: Thatcherism - a political phiosophy founded on deregulated financial markets, privatisation of state assets, sales of council homes and dismantling of the welfare state. Thatcherism wasn’t just an economic policy, however, it was a social psychology based on possessive individualism. It was about getting as much as possible for yourself and your family and then letting the rest of the world go hang. “There's no such thing as society” she said in her most magisterial soundbite, and while she insists that she didn’t mean it literally, actually she did. And she largely succeeded, too, in destroying collectivism, a form of social solidarity that had endured in large parts of Britain since the Second World War.
Thatcher sensed intuitively that the key to breaking communitarian ties was home ownership. Before 1979, the sale of council houses had been regarded as a fantasy of the looney right. But she went right ahead and did it, and by ushering in the age of mass home ownership - “the property owning democracy” - she turned Britain into a nation of property speculators. Homes, once just places to live, became assets to be traded, used as a private fortress of personal wealth - and ultimately served as vehicles of speculation by the banks. In 1979, when Thatcher came to power, fewer people in Scotland owned their own homes than in Communist Poland. Now, nearly seventy percent of us are owner-occupiers. Ask long serving trades unionists why workers are so reluctant to go on strike these days and they will often say: mortgages.
Thatcher realised that to destroy socialism she had to destroy the political power of the industrial working class. She was more of a Marxist than most people on the far Left, which had fragmented into a litter of splinter groups arguing about obscure points of dogma. Few people in the media believed that Thatcher could possibly succeed with her scorched earth policy of destroying the unions through high interest rates, industrial closures and mass unemployment. “She’ll end up like Heath”, we snorted, “doing a U-turn and resorting to incomes policy, states subsidies and inflation”. But “the lady wasn’t for turning” and she broke the unions, and Labour, on the wheel of joblessness, and paid the bills using Scottish oil revenues. She wisely left the miners to last, confronting them on her own terms in 1984.
Everyone underestimated Thatcher’s resolve to deregulate and break the power of the state. Like council house sales, privatisation had been a preserve of right wing think tanks like the Adam Smith Institute. Most economists beleived that a modern economy required significant state ownership to regulate the free market. Not Thatcher. Starting with BT and British Gas, she launched a firesale of nationalised industries, getting the British public to buy companies they already owned. “Tell Sid” said the advert alerting the nation to the new opportunities of “popular capitalism”. Businessmen like Richard Branson became celebrities.
She also ignited the “Big Bang” in the City of London - a wave of deregulation which opened the way to the ‘anything goes’ era of financial buccaneering. The great misselling scandals - endowment mortgages, personal pensions, ';with profits' insurance bonds - all had their origins in the 1980s. Commission-driven “independent” financial advisers developed ever-more ingenious “financial products”. One of Thatcher’s earliest acts was to break the link between the state pension and average earnings. In future they would rise with inflation. This apparently technical move ensured that the value of the state pension would wither to next to nothing, forcing people to seek security in private pension provision.
Her ultimate objective was to privatise health and education, but she never managed to achieve that, leaving it to her successor. When Lady Thatcher was asked recently what her greatest legacy was, she said: Tony Bliar. Apocryphal it may be, but it is a compliment he is willing to reciprocate. New Labour was built on the foundations laid by Thatcherism. Blair promoted wealth as a virtue and subjected public services to market disciplines. Local authority bureaucrats started awarding themselves mega salaries; Chancellor Gordon Brown endlessly praised the City of London; MPs turned their political offices into a source of personal enrichment.
While Thatcher destroyed socialism at home by making Tony Blair inevitable, abroad she stiffened the resolve of Ronald Reagan - the hawkish US Republican President - to confront communism by placing a new generation of nuclear weapons in Europe. Cruise and Pershing 11 missiles ensured that any tank-led invasion by the Warsaw Pact would lead immediately to nuclear war. It was an extraordinary escalation of the arms race, and led to a revival of the Campaign for Nuclear Disarmament in Britain. It is hard for people under he age of 45 to appreciate quite what life was like under the Cold War. Nuclear annihilation was a very real threat in hte 80's which coloured many peoples’ lives and inspired the savage humour of cartoonists like Steve Bell.
In the end, of course, it wasn’t missiles but consumerism and that killed communism. It was the visible economic success of the West in the 80’s, and its libertarian youth culture. that rotted the authoritarian regimes of Eastern Europe and led their citizens to tear down Berlin Wall. However, it is an inconvenient truth for the Left that many anti-communist radicals were genuinely inspired by Margaret Thatcher. From the Gdansk shipyard worker Lech Walensa in Poland to the Czech president/playwrite, Vaclav Havel - who presented the “Iron Lady” with an award for her role in bringing down the Iron Curtain - Margaret Thatcher was a beacon of freedom.
Perhaps it is only now, at the twilight of Thatcherism that we can begin to understand her true historical significance. There's an epic quality to everything about the Thatcher story. She was the last British prime minister to launch a shooting war against a foreign power - 8,000 miles away in the South Atlantic over the Falklands Islands. Who dares wins, and she did - though it was close. She woudl have declared war too on the European Union if her party had let her.
And there is a Wagnerian quality, now to the collapse of Thatcherism and the fall of its Gods. The origins of the greatest economic depression in a hundred years lay in May 1979 when she became prime minister. The economic engine she created, based on the unrestrained accumulation of wealth and deregulated financial markets, turned into an uncontrollable global juggernaut which has just careered over a cliff. Almost everything that has gone wrong with the neoliberal model - the housing bubble, the bonus culture, fraudulent derivatives, tax havens, financial speculation, the collapse of manufacturing - all had their origins in the Thatcher revolution thirty years ago. When Cameron Tories today talk of the “broken society” what they are really talking about is the society of rampant individualism and moral anarchy created by their own former leader.
Sir Fred Goodwin is the ultimate Thatherite - a sociophathic individualist who values personal enrichment even above self-respect; who is so dedicated to financial gain that he is willing to be cast as a pariah, loathed for his destructive greed. But then the truth is that we all became just a little infected with Thatcherism during the “me generation”. We privately gloried in the apparently ever-rising value of our homes; got vicarious enjoyment from the fantasy capitalism of “The Apprentice”; laughed at the antics of anti-social petrolheads like Jeremy Clarkson. The devil had all the best tunes during the Thatcher era - but unfortunately he was still the devil. And now that we face an era of social and economic chaos, against a background of runaway climate change, we will all have time to repent at leisure for our flirtation with Grantham’s most famous daughter.
Demonstrators and journalists swapped gallows humour - “Chile this morning, isn’t it” - sensing that, with the election of the right-wing housewife superstar, things really had changed. None of us realised quite how much. Margaret Thatcher was far more of a revolutionary than any of the anti-capitalists at Torness. She changed Britain, and the world, and altered the way we think about politics and society. Love her or loathe her, we are all Thatcher’s children.
There was an inevitability about the Tory victory in 1979. Nothing was working. The country had just emerged from the Winter of Discontent, as the tabloids dubbed the great public sector strikes when “the dead lay unburied and rubbish uncollected in the streeets” - allegedly. What was certainly true was that the Labour prime minister, James Callaghan had made a disastrous decision in delaying a general election which he would probably have won in autumn 1978. By April 1979 Labour was forced to fight a campaign in the teeth of rising unemployment and industrial strife largely caused by Callaghan’s own public sector cuts. Curiously, Gordon Brown seems to have opted for much the same electoral strategy today.
The Tories deployed the most succesful advertising campaign in election history: “Labour Isn’t Working”. The dole queue in the Saatchi and Saatchi poster was in fact a photoshopped line of Hendon Young Conservatives - not many people know that. Nor did people know that under Margaret Thatcher, unemployment was about to rise to levels not seen in Britain since the 1930s, as Britain plunged into the deepest manufacturing recession since the war. Unemployment rose over three million and devastated Scotland's industrial communities. “Bathgate no more, Linwood no more...” sang The Proclaimers, as Scotland experienced the kind of social chaos that was to hit Russia in the 1990s. We’re still living with the legacy today in the high rates of heart disease, depression and alcoholism in West Central Scotland.
But Scotland was never high on Margaret Thatcher’s priority list. Her horizons were and as wide as the world as deep as history. She wanted to “abolish socialism” at home and defeat communism abroad. Incredibly, she arguably did both, and at the same time gave her name to a new “ism”: Thatcherism - a political phiosophy founded on deregulated financial markets, privatisation of state assets, sales of council homes and dismantling of the welfare state. Thatcherism wasn’t just an economic policy, however, it was a social psychology based on possessive individualism. It was about getting as much as possible for yourself and your family and then letting the rest of the world go hang. “There's no such thing as society” she said in her most magisterial soundbite, and while she insists that she didn’t mean it literally, actually she did. And she largely succeeded, too, in destroying collectivism, a form of social solidarity that had endured in large parts of Britain since the Second World War.
Thatcher sensed intuitively that the key to breaking communitarian ties was home ownership. Before 1979, the sale of council houses had been regarded as a fantasy of the looney right. But she went right ahead and did it, and by ushering in the age of mass home ownership - “the property owning democracy” - she turned Britain into a nation of property speculators. Homes, once just places to live, became assets to be traded, used as a private fortress of personal wealth - and ultimately served as vehicles of speculation by the banks. In 1979, when Thatcher came to power, fewer people in Scotland owned their own homes than in Communist Poland. Now, nearly seventy percent of us are owner-occupiers. Ask long serving trades unionists why workers are so reluctant to go on strike these days and they will often say: mortgages.
Thatcher realised that to destroy socialism she had to destroy the political power of the industrial working class. She was more of a Marxist than most people on the far Left, which had fragmented into a litter of splinter groups arguing about obscure points of dogma. Few people in the media believed that Thatcher could possibly succeed with her scorched earth policy of destroying the unions through high interest rates, industrial closures and mass unemployment. “She’ll end up like Heath”, we snorted, “doing a U-turn and resorting to incomes policy, states subsidies and inflation”. But “the lady wasn’t for turning” and she broke the unions, and Labour, on the wheel of joblessness, and paid the bills using Scottish oil revenues. She wisely left the miners to last, confronting them on her own terms in 1984.
Everyone underestimated Thatcher’s resolve to deregulate and break the power of the state. Like council house sales, privatisation had been a preserve of right wing think tanks like the Adam Smith Institute. Most economists beleived that a modern economy required significant state ownership to regulate the free market. Not Thatcher. Starting with BT and British Gas, she launched a firesale of nationalised industries, getting the British public to buy companies they already owned. “Tell Sid” said the advert alerting the nation to the new opportunities of “popular capitalism”. Businessmen like Richard Branson became celebrities.
She also ignited the “Big Bang” in the City of London - a wave of deregulation which opened the way to the ‘anything goes’ era of financial buccaneering. The great misselling scandals - endowment mortgages, personal pensions, ';with profits' insurance bonds - all had their origins in the 1980s. Commission-driven “independent” financial advisers developed ever-more ingenious “financial products”. One of Thatcher’s earliest acts was to break the link between the state pension and average earnings. In future they would rise with inflation. This apparently technical move ensured that the value of the state pension would wither to next to nothing, forcing people to seek security in private pension provision.
Her ultimate objective was to privatise health and education, but she never managed to achieve that, leaving it to her successor. When Lady Thatcher was asked recently what her greatest legacy was, she said: Tony Bliar. Apocryphal it may be, but it is a compliment he is willing to reciprocate. New Labour was built on the foundations laid by Thatcherism. Blair promoted wealth as a virtue and subjected public services to market disciplines. Local authority bureaucrats started awarding themselves mega salaries; Chancellor Gordon Brown endlessly praised the City of London; MPs turned their political offices into a source of personal enrichment.
While Thatcher destroyed socialism at home by making Tony Blair inevitable, abroad she stiffened the resolve of Ronald Reagan - the hawkish US Republican President - to confront communism by placing a new generation of nuclear weapons in Europe. Cruise and Pershing 11 missiles ensured that any tank-led invasion by the Warsaw Pact would lead immediately to nuclear war. It was an extraordinary escalation of the arms race, and led to a revival of the Campaign for Nuclear Disarmament in Britain. It is hard for people under he age of 45 to appreciate quite what life was like under the Cold War. Nuclear annihilation was a very real threat in hte 80's which coloured many peoples’ lives and inspired the savage humour of cartoonists like Steve Bell.
In the end, of course, it wasn’t missiles but consumerism and that killed communism. It was the visible economic success of the West in the 80’s, and its libertarian youth culture. that rotted the authoritarian regimes of Eastern Europe and led their citizens to tear down Berlin Wall. However, it is an inconvenient truth for the Left that many anti-communist radicals were genuinely inspired by Margaret Thatcher. From the Gdansk shipyard worker Lech Walensa in Poland to the Czech president/playwrite, Vaclav Havel - who presented the “Iron Lady” with an award for her role in bringing down the Iron Curtain - Margaret Thatcher was a beacon of freedom.
Perhaps it is only now, at the twilight of Thatcherism that we can begin to understand her true historical significance. There's an epic quality to everything about the Thatcher story. She was the last British prime minister to launch a shooting war against a foreign power - 8,000 miles away in the South Atlantic over the Falklands Islands. Who dares wins, and she did - though it was close. She woudl have declared war too on the European Union if her party had let her.
And there is a Wagnerian quality, now to the collapse of Thatcherism and the fall of its Gods. The origins of the greatest economic depression in a hundred years lay in May 1979 when she became prime minister. The economic engine she created, based on the unrestrained accumulation of wealth and deregulated financial markets, turned into an uncontrollable global juggernaut which has just careered over a cliff. Almost everything that has gone wrong with the neoliberal model - the housing bubble, the bonus culture, fraudulent derivatives, tax havens, financial speculation, the collapse of manufacturing - all had their origins in the Thatcher revolution thirty years ago. When Cameron Tories today talk of the “broken society” what they are really talking about is the society of rampant individualism and moral anarchy created by their own former leader.
Sir Fred Goodwin is the ultimate Thatherite - a sociophathic individualist who values personal enrichment even above self-respect; who is so dedicated to financial gain that he is willing to be cast as a pariah, loathed for his destructive greed. But then the truth is that we all became just a little infected with Thatcherism during the “me generation”. We privately gloried in the apparently ever-rising value of our homes; got vicarious enjoyment from the fantasy capitalism of “The Apprentice”; laughed at the antics of anti-social petrolheads like Jeremy Clarkson. The devil had all the best tunes during the Thatcher era - but unfortunately he was still the devil. And now that we face an era of social and economic chaos, against a background of runaway climate change, we will all have time to repent at leisure for our flirtation with Grantham’s most famous daughter.
Tuesday, April 07, 2009
G20 Or Whatever...
What a pantomime. Black Range Rovers, fancy frocks, the Queen dwarfed by the Obamas, the obligatory gaffe from the Duke of Edinburgh, Sarko being unfashionably late. The official engagements at the G20 were much weirder than the anarchist street parties outside, which have developed a kind of formality of their own. The massed ranks of Metropolitan Police performing the traditional truncheon display after the ceremonial trashing of RBS windows. They should put it on the social calendar.
But what were we all supposed to make of these shiny happy world leaders at their dinners and receptions? I was reminded of the film, Titanic. The unsinkable ship was a kind of metaphor for Edwardian society before the First World War. In the state lounges and dining halls, the great and the good carried on with their elaborate social rituals unaware that they were heading for an iceberg. They continued to go through the motions even as the ship went down.
The G20 managed to rearrange rather more than the deck chairs, but did nothing to solve the fundamental design flaws. It was an exercise in collective morale boosting, keeping spirits up, a group hug. But as they tucked into Jamie Oliver’s Scottish Salmon, world trade was sinking beneath them faster than at any time since the second world war. The IMF last week doubled its forecast of losses from the US banking crisis to $2.2 trillion. Three thousand jobs losses were announced in Britain alone on the day of the official G20 communiqué - and the UK recession has hardly begun.
Of course, we shouldn’t wallow in negativity. One trillion dollars from the richest nations will help. Though it is mostly going to the IMF to provide loans to countries in Eastern Europe that are falling like skittles - and perhaps to Britain which is wobbling alarmingly. Tax havens will become more transparent, and there is help for exporters. But this was no comprehensive solution to the global slump and to be fair none of the participants pretended its was. The only really significant intellectual contribution came from the Chinese who proposed a new international reserve currency to replace the dollar. In terms of Geopolitics, the G20 did mark a watershed with the Asians looking beyond the era of American economic and military hegemony.
As an event, the G20 was a presentational coup for Gordon Brown, perhaps even the CV for his next job. He is surely up for a plum role in international banking after this display, and it may not be long before he’s on the job market. Expectations were carefully lowered in advance of the summit so that almost any agreement could be hailed as a triumph. The threatened ‘walk out’ by the French if Anglo-Saxon capitalism wasn’t curbed was pure theatre badly acted.
The truth is that no one really knows how to curb Anglo Saxon globalisation, because regulation takes place within national jurisdictions. There is as yet no international body capable of reining in the trillions of dollars that flow uncontrolled around the world financial markets. Similarly, a “whatever it takes” fiscal stimulus was being proposed by the countries least able to afford one: Britain and America. The idea of massively increasing debt in order to solve a crisis caused by debt is simply untenable. Obama and Brown must know this, so they were probably quite glad to have their ‘hands tied’ by the Europeans.
The smiley world leaders returned home to industrial closures, mass redundancies and mounting public and private debt. The banks aren’t lending, and the G20 will do nothing to change that. National governments have handed hundreds of billions of public funds to irresponsible and unreformed financial institutions through various schemes to buy their toxic assets. And the state-funded banks already up to their old tricks - incredibly using public money to buy up their own toxic assets; still paying dividends and bonuses; ignoring the environment. RBS, which is 80% state owned, has used £10 billion of the £30 billion it received from the UK taxpayer to invest in fossil fuel projects.
Somehow the world has to create an international financial governance with the power to regulate the international banks and curb speculation. A reformed International Monetary Fund could have the responsibility of overseeing the creation of a true international currency unit, against which all others will be measured. This is a big ask, but by no means impossible. . If Europe could introduce the Euro, then the world can introduce Bancor - which was what Keynes proposed to call the international currency in 1946. A common global currency is the only way to address the problem of currency chaos and financial anarchy.
The £250bn in Special Drawing Rights agreed at the G20 are a move in the right direction. An international currency would not only bring stability and permit international regulation, it could also be used to generate loans to the African continent and other parts of the non-developed world. This is a matter, not of charity, but of self-interest for the West because the development of Africa will create new markets and new wealth to replac what is being lost in the global depression. After spending trillions rescuing insolvent banks, America and Britain can never again say that the money isn’t there for this global stimulus.
The other international priority is of course climate change which hardly got a mention at the G20. Again, this is in our global interest- we don’t want to fry - and also in our economic interest, since it could be the biggest engine of job creation in history. The development of renewables, the scrubbing and storage of carbon, the rebuilding of the housing stock, extending public transport and researching nuclear fusion could create new markets and investment opportunities.
Capitalism both destroys and creates. It has created greater material prosperity than ever in human history, but it has entered a destructive phase of the cycle as the excesses of the debt boom are swept away. It is also destroying the environment because the impact on the planet is not costed. However, capitalism goes where it is allowed to go. International regulation and specific climate goals could provide the foundation for another global economic boom, based on creative entrepreneurialism and sound finance.
This is not visionary or futuristic. Most people who have looked at the problem, from Sir Nicholas Stern to George Soros, have come to the same conclusion. The problem is simply getting from here to there. A small step was taken along the road in London this week. We can only hope, as Mao said, that the journey of a thousand miles begins with one step.
But what were we all supposed to make of these shiny happy world leaders at their dinners and receptions? I was reminded of the film, Titanic. The unsinkable ship was a kind of metaphor for Edwardian society before the First World War. In the state lounges and dining halls, the great and the good carried on with their elaborate social rituals unaware that they were heading for an iceberg. They continued to go through the motions even as the ship went down.
The G20 managed to rearrange rather more than the deck chairs, but did nothing to solve the fundamental design flaws. It was an exercise in collective morale boosting, keeping spirits up, a group hug. But as they tucked into Jamie Oliver’s Scottish Salmon, world trade was sinking beneath them faster than at any time since the second world war. The IMF last week doubled its forecast of losses from the US banking crisis to $2.2 trillion. Three thousand jobs losses were announced in Britain alone on the day of the official G20 communiqué - and the UK recession has hardly begun.
Of course, we shouldn’t wallow in negativity. One trillion dollars from the richest nations will help. Though it is mostly going to the IMF to provide loans to countries in Eastern Europe that are falling like skittles - and perhaps to Britain which is wobbling alarmingly. Tax havens will become more transparent, and there is help for exporters. But this was no comprehensive solution to the global slump and to be fair none of the participants pretended its was. The only really significant intellectual contribution came from the Chinese who proposed a new international reserve currency to replace the dollar. In terms of Geopolitics, the G20 did mark a watershed with the Asians looking beyond the era of American economic and military hegemony.
As an event, the G20 was a presentational coup for Gordon Brown, perhaps even the CV for his next job. He is surely up for a plum role in international banking after this display, and it may not be long before he’s on the job market. Expectations were carefully lowered in advance of the summit so that almost any agreement could be hailed as a triumph. The threatened ‘walk out’ by the French if Anglo-Saxon capitalism wasn’t curbed was pure theatre badly acted.
The truth is that no one really knows how to curb Anglo Saxon globalisation, because regulation takes place within national jurisdictions. There is as yet no international body capable of reining in the trillions of dollars that flow uncontrolled around the world financial markets. Similarly, a “whatever it takes” fiscal stimulus was being proposed by the countries least able to afford one: Britain and America. The idea of massively increasing debt in order to solve a crisis caused by debt is simply untenable. Obama and Brown must know this, so they were probably quite glad to have their ‘hands tied’ by the Europeans.
The smiley world leaders returned home to industrial closures, mass redundancies and mounting public and private debt. The banks aren’t lending, and the G20 will do nothing to change that. National governments have handed hundreds of billions of public funds to irresponsible and unreformed financial institutions through various schemes to buy their toxic assets. And the state-funded banks already up to their old tricks - incredibly using public money to buy up their own toxic assets; still paying dividends and bonuses; ignoring the environment. RBS, which is 80% state owned, has used £10 billion of the £30 billion it received from the UK taxpayer to invest in fossil fuel projects.
Somehow the world has to create an international financial governance with the power to regulate the international banks and curb speculation. A reformed International Monetary Fund could have the responsibility of overseeing the creation of a true international currency unit, against which all others will be measured. This is a big ask, but by no means impossible. . If Europe could introduce the Euro, then the world can introduce Bancor - which was what Keynes proposed to call the international currency in 1946. A common global currency is the only way to address the problem of currency chaos and financial anarchy.
The £250bn in Special Drawing Rights agreed at the G20 are a move in the right direction. An international currency would not only bring stability and permit international regulation, it could also be used to generate loans to the African continent and other parts of the non-developed world. This is a matter, not of charity, but of self-interest for the West because the development of Africa will create new markets and new wealth to replac what is being lost in the global depression. After spending trillions rescuing insolvent banks, America and Britain can never again say that the money isn’t there for this global stimulus.
The other international priority is of course climate change which hardly got a mention at the G20. Again, this is in our global interest- we don’t want to fry - and also in our economic interest, since it could be the biggest engine of job creation in history. The development of renewables, the scrubbing and storage of carbon, the rebuilding of the housing stock, extending public transport and researching nuclear fusion could create new markets and investment opportunities.
Capitalism both destroys and creates. It has created greater material prosperity than ever in human history, but it has entered a destructive phase of the cycle as the excesses of the debt boom are swept away. It is also destroying the environment because the impact on the planet is not costed. However, capitalism goes where it is allowed to go. International regulation and specific climate goals could provide the foundation for another global economic boom, based on creative entrepreneurialism and sound finance.
This is not visionary or futuristic. Most people who have looked at the problem, from Sir Nicholas Stern to George Soros, have come to the same conclusion. The problem is simply getting from here to there. A small step was taken along the road in London this week. We can only hope, as Mao said, that the journey of a thousand miles begins with one step.
Monday, April 06, 2009
toile humour
Embra's annual culture fest was renamed the "Nedinburgh Festival" last week, thanks to the work of Glasgow graphic designers, Timorous Beasties. Their low life toile, used for the EIF bags and brochures, depicted drunks and ne’erdooweels instead of tartan and pipers. The shock!
'Toile' as i’m sure you know is the smudgy 18th Century French style of interior design, “toile du Jouy”. Only the Glasgow boys replaced the charming rustic scenes with episodes from everyday Edinburgh life, like gadgies urinating over Greyfriars Bobby's fountain and dossers lying beneath a statue of David Hume wearing a traffic cone on his head. Also featured were tower blocks and road works.
Actually they missed out on quite a few images from contemporary Edinburgh , such as scumbag bankers being stoned by angry citizens as they make off with their bonuses. Or estate agents beaten-up by bankrupt homeowners who can't sell. Or knickerless matrons in Range Rovers running over pedestrians as they pick up offspring from their expensive schools. Maybe next time.
The toile was of course a publicity-seeking exercise by the promoters of the Edinburgh Festvial, and it worked a treat. Not since they wheeled a nude across the organ gallery of the McEwan Hall in 1963 have we heard such moral outrage from the city fathers and mothers. The Tory MSP David McLetchie suggested it was all a Glasgow plot to do down Edinburgh. Presumably no one told him that the Beastie boys had already soiled the Second City's image with a Glasgow toile depicting drug addicts shooting up and prostitutes plying their trade.
The wallpaper is currently selling for £250 a roll and reportedly walking out the shop, which just goes to show what people will put on their walls these days. The toile style is most associated with the transvestite potter, Grayson Perry who used it on ceramics to depict rape, child abuse and homosexual congress. His work now sells for phenomenal sums and Perry is regarded as a significant artistic figure.
So how about a little recognition for the subjects of the Timorous Beastie toile? Pishing over monuments is clearly a new and exciting performance art and the vagrants and drunks should apply for an arts council grant. The traffic cone on David Hume’s head is probably worth a couple of million already and should be guarded by a special detachment from the National Gallery. The notorious roadworks in Princes Street should be renamed “Stasis Tramwerk” and billed Europe’s biggest modern art installation. People would flock to see it. Well, I’ve seen a lot worse in the Turbine hall of the Tate Modern
'Toile' as i’m sure you know is the smudgy 18th Century French style of interior design, “toile du Jouy”. Only the Glasgow boys replaced the charming rustic scenes with episodes from everyday Edinburgh life, like gadgies urinating over Greyfriars Bobby's fountain and dossers lying beneath a statue of David Hume wearing a traffic cone on his head. Also featured were tower blocks and road works.
Actually they missed out on quite a few images from contemporary Edinburgh , such as scumbag bankers being stoned by angry citizens as they make off with their bonuses. Or estate agents beaten-up by bankrupt homeowners who can't sell. Or knickerless matrons in Range Rovers running over pedestrians as they pick up offspring from their expensive schools. Maybe next time.
The toile was of course a publicity-seeking exercise by the promoters of the Edinburgh Festvial, and it worked a treat. Not since they wheeled a nude across the organ gallery of the McEwan Hall in 1963 have we heard such moral outrage from the city fathers and mothers. The Tory MSP David McLetchie suggested it was all a Glasgow plot to do down Edinburgh. Presumably no one told him that the Beastie boys had already soiled the Second City's image with a Glasgow toile depicting drug addicts shooting up and prostitutes plying their trade.
The wallpaper is currently selling for £250 a roll and reportedly walking out the shop, which just goes to show what people will put on their walls these days. The toile style is most associated with the transvestite potter, Grayson Perry who used it on ceramics to depict rape, child abuse and homosexual congress. His work now sells for phenomenal sums and Perry is regarded as a significant artistic figure.
So how about a little recognition for the subjects of the Timorous Beastie toile? Pishing over monuments is clearly a new and exciting performance art and the vagrants and drunks should apply for an arts council grant. The traffic cone on David Hume’s head is probably worth a couple of million already and should be guarded by a special detachment from the National Gallery. The notorious roadworks in Princes Street should be renamed “Stasis Tramwerk” and billed Europe’s biggest modern art installation. People would flock to see it. Well, I’ve seen a lot worse in the Turbine hall of the Tate Modern
Monday, March 30, 2009
Dunfermline disaster - many dead
Another one bites the dust. Scotland's largest building society the Dunfermline, has collapsed amid the usual cries of betrayal, London perfidy and financial obfuscation. I have a scintilla of sympathy for the combative Chairman, Jim Faulds, who genuinely seems to believe in the mutual principle – but why then did the Dunfermline abandon it in favour of speculation? He and his executives will be reaching for their golden parachutes this morning and filling their pension pots, so save your concern for the 500 employees. And for the taxpayer - the bank of you and me – which gets handed the bill for Dunfermline's toxic assets.
And from a supposedly boring building society, for heaven's sake! I seem to recall Dunfermline boasting that it was so prudent in its lending that it just didn't “do” mortgage repossessions. Now we learn that it has been heavily involved in a variety of sub prime investments, and was lending 100% mortgages even as the Scottish housing market slumped. We had been told repeatedly that this conservative institution was well-capitalised and solvent until, er, it wasn't. A reported loss of £26m became £50m, then £100m, then think-of-a-number-and-double-it.
It was the same story with HBOS and RBS – everyone insists until the very last moment that there is nothing to worry about, perfectly safe, sound business, riddle diddle - and then, bang, the institution crashes into oblivion taking billions of public money with it. Misinforming investors about the financial health of a company should surely be against the law. Perhaps Gordon Brown, who has the privilege of having Dunfermline in his constituency backyard, could suggest this to the G20 this week as one of his new regulatory reforms.
And while we're at it, what on earth was a mutual society, which is supposed to finance mortgage loans from retail deposits, doing buying dodgy mortgages from the American bank GMAC – notorious for the unreliability of its sub-prime assets? A building society is supposed to be owned by its depositors. Did they know about the &##163;650m in commercial property deals? Or its exposure to ambitious IT investments? Or that Dunfermline was in bed with Lehman Brothers, one of the most hard-nosed and aggressive Wall St. investment banks? And don't give me the line that: “Oh we didna ken; we're just wee folk fae Fife”. Well they ken noo.
I agree that the HBOS and RBS bail outs were an even greater reward for failure and should never have happened - but three wrongs don't make a right. Nationalisation or administration were the only realistic options. The Treasury has blown so much money bailing out the dysfunctional banks, there's no way it was going to establish a precedent by bank-rolling dud building societies as well.
That this is a further nail in the coffin of the Scottish financial services 'industry' hardly needs to be said. The coffin has been nailed so hard there's barely any wood left. What happened to prudence? And how did a nation renowned for thrift and financial caution come to be cursed by such a disreputable and incompetent financial elite? Two of the most toxic banks on the planet have our names on them: Royal Bank of Scotland and Halifax Bank of Scotland. Sir Fred Goodwin has become an international icon of stupidity, recklessness and greed. Nor do I subscribe to the view that it is my patriotic duty defend bosses of Dunfermline Building Society just because they happen to be Scottish.
We thought Alex Salmond had learned to sup with a longer spoon in his dealings with bankers, but here he goes again, pleading for a rescue, defending the indefensible, blaming London. As Dunfermline is broken up, you can be sure that the FSA and the Treasury will make clear just how reckless was the behaviour of its executives. The briefings have already begun. So why expend political capital on trying to save them? Yes, I know that there are jobs at stake and there is a risk that another head office will go south. But these jobs have been destroyed, not by the Treasury, but by the Dunfermline Building Society which believed its own propaganda about Scotland being immune to the property crash.
Being an apologist for busted financial institutions undermines the authority of the First Minister's office The same happened with HBOS when the FM leapt to accuse the “spivs and speculators” for its share collapse, until we discovered that the worst spivs and speculators we're in HBOS itself. Then Alex Salmond doggedly supported Fred Goodwin's Royal Bank of Scotland, which he assured us was a robust, well-capitalised and highly profitable business – until it needed the biggest rights issue in corporate history, and then the biggest government bail-out in history. We keep hearing about how Gordon Brown should be apologising for failing to realise how bad our bad banks really were, but I haven't heard much contrition from the First Minister.
Of course political leaders can't go around talking down the economy and RBS and HBOS were two of Scotland's biggest employers. But nor can they allow themselves to appear to be captured by one sectional interest. FForget Sandi Thom's expenses, the real scandal is how Scotland is now forever branded as home of the world's worst bankers - Scottish government approved.
These motley fools have largely destroyed Scotland's economy and now our biggest building society. The Dunfermline executives do not deserve to be bailed out and rewarded for this failure. Every one of them should have had the decency to have resigned by now. They deluded themselves into thinking that if they played the FSA long enough, and enlisted the political support of the Scottish government, that they would be bailed out like the big retail banks. But that was never going to happen. Dunfermline Building Society is not 'too big to fail' and they should have realised that before entering the speculative poker game.
No one regrets the loss of yet another mutual society more than I do., but they should have kept their noses clean - in the interests of their members if nothing else. They, not the executives, have been betrayed. Dunfermline is a dead parrot, it has gone to meet its maker, if it hadn't been concealing its losses it would be pushing up the daisies. It is a late building society. The end.
And from a supposedly boring building society, for heaven's sake! I seem to recall Dunfermline boasting that it was so prudent in its lending that it just didn't “do” mortgage repossessions. Now we learn that it has been heavily involved in a variety of sub prime investments, and was lending 100% mortgages even as the Scottish housing market slumped. We had been told repeatedly that this conservative institution was well-capitalised and solvent until, er, it wasn't. A reported loss of £26m became £50m, then £100m, then think-of-a-number-and-double-it.
It was the same story with HBOS and RBS – everyone insists until the very last moment that there is nothing to worry about, perfectly safe, sound business, riddle diddle - and then, bang, the institution crashes into oblivion taking billions of public money with it. Misinforming investors about the financial health of a company should surely be against the law. Perhaps Gordon Brown, who has the privilege of having Dunfermline in his constituency backyard, could suggest this to the G20 this week as one of his new regulatory reforms.
And while we're at it, what on earth was a mutual society, which is supposed to finance mortgage loans from retail deposits, doing buying dodgy mortgages from the American bank GMAC – notorious for the unreliability of its sub-prime assets? A building society is supposed to be owned by its depositors. Did they know about the &##163;650m in commercial property deals? Or its exposure to ambitious IT investments? Or that Dunfermline was in bed with Lehman Brothers, one of the most hard-nosed and aggressive Wall St. investment banks? And don't give me the line that: “Oh we didna ken; we're just wee folk fae Fife”. Well they ken noo.
I agree that the HBOS and RBS bail outs were an even greater reward for failure and should never have happened - but three wrongs don't make a right. Nationalisation or administration were the only realistic options. The Treasury has blown so much money bailing out the dysfunctional banks, there's no way it was going to establish a precedent by bank-rolling dud building societies as well.
That this is a further nail in the coffin of the Scottish financial services 'industry' hardly needs to be said. The coffin has been nailed so hard there's barely any wood left. What happened to prudence? And how did a nation renowned for thrift and financial caution come to be cursed by such a disreputable and incompetent financial elite? Two of the most toxic banks on the planet have our names on them: Royal Bank of Scotland and Halifax Bank of Scotland. Sir Fred Goodwin has become an international icon of stupidity, recklessness and greed. Nor do I subscribe to the view that it is my patriotic duty defend bosses of Dunfermline Building Society just because they happen to be Scottish.
We thought Alex Salmond had learned to sup with a longer spoon in his dealings with bankers, but here he goes again, pleading for a rescue, defending the indefensible, blaming London. As Dunfermline is broken up, you can be sure that the FSA and the Treasury will make clear just how reckless was the behaviour of its executives. The briefings have already begun. So why expend political capital on trying to save them? Yes, I know that there are jobs at stake and there is a risk that another head office will go south. But these jobs have been destroyed, not by the Treasury, but by the Dunfermline Building Society which believed its own propaganda about Scotland being immune to the property crash.
Being an apologist for busted financial institutions undermines the authority of the First Minister's office The same happened with HBOS when the FM leapt to accuse the “spivs and speculators” for its share collapse, until we discovered that the worst spivs and speculators we're in HBOS itself. Then Alex Salmond doggedly supported Fred Goodwin's Royal Bank of Scotland, which he assured us was a robust, well-capitalised and highly profitable business – until it needed the biggest rights issue in corporate history, and then the biggest government bail-out in history. We keep hearing about how Gordon Brown should be apologising for failing to realise how bad our bad banks really were, but I haven't heard much contrition from the First Minister.
Of course political leaders can't go around talking down the economy and RBS and HBOS were two of Scotland's biggest employers. But nor can they allow themselves to appear to be captured by one sectional interest. FForget Sandi Thom's expenses, the real scandal is how Scotland is now forever branded as home of the world's worst bankers - Scottish government approved.
These motley fools have largely destroyed Scotland's economy and now our biggest building society. The Dunfermline executives do not deserve to be bailed out and rewarded for this failure. Every one of them should have had the decency to have resigned by now. They deluded themselves into thinking that if they played the FSA long enough, and enlisted the political support of the Scottish government, that they would be bailed out like the big retail banks. But that was never going to happen. Dunfermline Building Society is not 'too big to fail' and they should have realised that before entering the speculative poker game.
No one regrets the loss of yet another mutual society more than I do., but they should have kept their noses clean - in the interests of their members if nothing else. They, not the executives, have been betrayed. Dunfermline is a dead parrot, it has gone to meet its maker, if it hadn't been concealing its losses it would be pushing up the daisies. It is a late building society. The end.
Sunday, March 22, 2009
Farewell Darling Jade
And so farewell then, Jade Goody, the brave and brilliant mum who did it all for her family and for victims of cancer, Her story is a parable for our modern times. A death to give us all hope. Read all about it on pages 2,3,4,5,6,7, including Jade’s last words and Jack’s hospital romps with dying star. Ok, I’m making that up - but only just. Every detail of Jade’s final days will no doubt be revealed under the various contracts negotiated by her agents. Her own memorial edition of OK magazine, "Jade Goody, 1981 - 2009, Official Tribute, was published with her consent even before she died. You couldn’t make that up.
The celebrity death watch on this unfortunate young woman was certainly a sign of the times. A defining moment in the history of celebrity culture, a tabloid Passion. After a benediction from the red-top Pope, Max Clifford, plastic surgeons and perfume manufacturers will carry her coffin to lie in state in the diary room, as the paparazzi fire off a 24 bulb salute. Her partner, Jack, will stand in state, accompanied by his probation officers. The Sun has opened a condolence book and is offering cash prizes to the sauciest entries. A statue of Jade Goody will be erected in the Big Brother garden.
I know we shouldn’t speak ill of the dead, and I don’t intend to, even though someone who sold their own terminal illness to the popular press can’t expect to be treated lightly by posterity. But in her departure, Jade Goody, did achieve some kind of grace and a certain nobility. The government has promised to review the minimum age for cervical cancer screening, so in a real sense her death may allow others to live. She donated some of the proceeds of her celebrity wedding to charity, so the slumdog millionairess has the moral edge on the scumbag bankers like ‘Sir’ Fred Goodwin.
But the beatification of Jade Goody is something else - it is a dubious celebration of the crass culture of the early 21st Century. The coverage of her decline was as undignified as it was tasteless - death as reality television. The attempts now to elevate her to a kind of underclass sainthood are deeply unattractive, even if they are well intentioned. Jade Goody can only ever be the patron saint of stupid; a product of a media that celebrates ignorance; a reflection of a society devoid of moral purpose. Her place in history is assured as one of the defining characters of the money-for-nothing bubble years when we lost any sense of real worth.
Jade Goody’s life was stranger than any fiction. A former dental nurse who rose to national prominence for thinking East Anglia was abroad and that Rio de Janeiro was a footballer became the ultimate celebrity - famous for being famous. The commercial endorsements followed her appearance on Big Brother in 2002 - where she succeeded in coming fourth - as did the boob jobs and beatings; the therapy and the dysfunctional relationships. After a few years the tabloids began to lose interest in the woman they had taken to calling the “fat pig”. Though she made many millions before her disastrous comeback appearance in 2007.
From being famous for being famous Jade Goody became infamous for being infamous. Her racist taunts of one of the Big Brother contestants, Shilpa Shetty, became a national issue, debated in parliament no less, and led to her being vilified by the media that had invented her. Worse, for a product of the L’Oreal age, she was dropped by the cosmetics industry because she really wasn’t worth it. She tried to rehabilitate herself by appearing on Bollywood Big Brother in India, but here it was that she met her fate, with the discovery that she had cervical cancer.
In a savage irony, this turned out to be Jade Goody’s best career move. As her battle with cancer progressed her earning power recovered. Soon she was Brave Jade, a mother doing all and selling all for her children. But only through death could she achieve tabloid redemption, and as the end drew nigh a macabre auction ensued as various populist organs bid for pieces of her final story. I suppose by the get-rich standards of modern times, her decision to exploit her illness was curiously admirable. If moral worth is to be measured by how much money you make, then what could be more worthy than getting it while you still can?
The scary thing, though, is that an entire generation of young women may now start seeing the late Jade Goody as a role model, as an inspiration. We already know that far too many young people, when asked what they want to be when they grow up, say: “famous”, as if celebrity is a career option. They want to be Paris Hilton or Jordan or any number of attention-seeking surgical freaks. Will young girls now model their careers on Jade Goody? If so, how do you emulate this modern paragon? Presumably by learning nothing, earning anything, making an exhibition of yourself and turning your death into a media circus.
Of course, this is not the time to attack Jade Goody just for being what she was. But it is a time to think very seriously about the society that made her. She was always excused her excesses on the grounds that Jade was ‘just being herself’. Her authenticity was her justification, even though almost everything about her was contrived - even her weight loss was based on lipo-suction rather than the exercise and diet regime she sold in her videos. She may have been dumb, but at public relations she was a genius.
But it all had to end. And as the 21 car funeral cortege winds its way through Bermondsey to the “ultimate party” planned to celebrate her life, comparisons will inevitably be drawn with the funeral of Diana Princess of Wales in 1997. It will be a morbid satire on the entire celebrity industry. Diana was the Peoples Princess, Jade was the Empress of the Estates. May they both rest in peace.
The celebrity death watch on this unfortunate young woman was certainly a sign of the times. A defining moment in the history of celebrity culture, a tabloid Passion. After a benediction from the red-top Pope, Max Clifford, plastic surgeons and perfume manufacturers will carry her coffin to lie in state in the diary room, as the paparazzi fire off a 24 bulb salute. Her partner, Jack, will stand in state, accompanied by his probation officers. The Sun has opened a condolence book and is offering cash prizes to the sauciest entries. A statue of Jade Goody will be erected in the Big Brother garden.
I know we shouldn’t speak ill of the dead, and I don’t intend to, even though someone who sold their own terminal illness to the popular press can’t expect to be treated lightly by posterity. But in her departure, Jade Goody, did achieve some kind of grace and a certain nobility. The government has promised to review the minimum age for cervical cancer screening, so in a real sense her death may allow others to live. She donated some of the proceeds of her celebrity wedding to charity, so the slumdog millionairess has the moral edge on the scumbag bankers like ‘Sir’ Fred Goodwin.
But the beatification of Jade Goody is something else - it is a dubious celebration of the crass culture of the early 21st Century. The coverage of her decline was as undignified as it was tasteless - death as reality television. The attempts now to elevate her to a kind of underclass sainthood are deeply unattractive, even if they are well intentioned. Jade Goody can only ever be the patron saint of stupid; a product of a media that celebrates ignorance; a reflection of a society devoid of moral purpose. Her place in history is assured as one of the defining characters of the money-for-nothing bubble years when we lost any sense of real worth.
Jade Goody’s life was stranger than any fiction. A former dental nurse who rose to national prominence for thinking East Anglia was abroad and that Rio de Janeiro was a footballer became the ultimate celebrity - famous for being famous. The commercial endorsements followed her appearance on Big Brother in 2002 - where she succeeded in coming fourth - as did the boob jobs and beatings; the therapy and the dysfunctional relationships. After a few years the tabloids began to lose interest in the woman they had taken to calling the “fat pig”. Though she made many millions before her disastrous comeback appearance in 2007.
From being famous for being famous Jade Goody became infamous for being infamous. Her racist taunts of one of the Big Brother contestants, Shilpa Shetty, became a national issue, debated in parliament no less, and led to her being vilified by the media that had invented her. Worse, for a product of the L’Oreal age, she was dropped by the cosmetics industry because she really wasn’t worth it. She tried to rehabilitate herself by appearing on Bollywood Big Brother in India, but here it was that she met her fate, with the discovery that she had cervical cancer.
In a savage irony, this turned out to be Jade Goody’s best career move. As her battle with cancer progressed her earning power recovered. Soon she was Brave Jade, a mother doing all and selling all for her children. But only through death could she achieve tabloid redemption, and as the end drew nigh a macabre auction ensued as various populist organs bid for pieces of her final story. I suppose by the get-rich standards of modern times, her decision to exploit her illness was curiously admirable. If moral worth is to be measured by how much money you make, then what could be more worthy than getting it while you still can?
The scary thing, though, is that an entire generation of young women may now start seeing the late Jade Goody as a role model, as an inspiration. We already know that far too many young people, when asked what they want to be when they grow up, say: “famous”, as if celebrity is a career option. They want to be Paris Hilton or Jordan or any number of attention-seeking surgical freaks. Will young girls now model their careers on Jade Goody? If so, how do you emulate this modern paragon? Presumably by learning nothing, earning anything, making an exhibition of yourself and turning your death into a media circus.
Of course, this is not the time to attack Jade Goody just for being what she was. But it is a time to think very seriously about the society that made her. She was always excused her excesses on the grounds that Jade was ‘just being herself’. Her authenticity was her justification, even though almost everything about her was contrived - even her weight loss was based on lipo-suction rather than the exercise and diet regime she sold in her videos. She may have been dumb, but at public relations she was a genius.
But it all had to end. And as the 21 car funeral cortege winds its way through Bermondsey to the “ultimate party” planned to celebrate her life, comparisons will inevitably be drawn with the funeral of Diana Princess of Wales in 1997. It will be a morbid satire on the entire celebrity industry. Diana was the Peoples Princess, Jade was the Empress of the Estates. May they both rest in peace.
Friday, March 20, 2009
something fishy in holyrood
MSPs often complain that they’re living in a goldfish bowl, so it's good to see them standing up for their fellow fish. The Holyrood petitions committee has asked the Scottish government to look into the welfare of Siamese fighting fish in Scotland’s pet shops. Apparently, these exotic creatures, which hail from Thailand, are suffering from obesity and lack of social interaction. Pretty much like the rest of the population in fact.
The petitions committee was responding to public representations on aquarium living arrangements. But the fishy tale hooked the sourer sections of the Scottish press, who’re always on the lookout for loony legislation - like not boiling lobsters or banning foie gras. When the economy is collapsing, cried the Fourth Estate, how dare Holyrood waste time on the fate of overweight fish with psychological disorders!
Actually, the question is really one for the press itself to answer: why did we devote so much time, editorials, comment and column inches to such a trivial tale? Aren’t there better things to write about? Scottish children are suffering worse obesity even than Siamese fighting fish, so why not more editorials about that? The answer of course is that row over betta splendens, as the fish are properly called, was a welcome relief from the economic gloom, and allowed punning subs to run pictures of exotic fish under “storm in a goldfish bowl” headlines. Commentators took a populist pop at Holyrood, for being a waste of space.
It also gave the many sane and well-balanced folk who post comments on newspaper websites a chance to vent their spleens - and boy do they have spleens to vent. Only in the Scottish blogosphere could the fate of gold fish be turned into a constitutional issue, with Labour and SNP trolls biffing each other over what the affair tells us about the legitimacy of the Scottish government. Many comments had to be removed because they were offensive.
Mind you, some of the less poisonous posts were really rather funny. The apparent antisocial behaviour of the fighting fish is down to the availability of cheap drink, said one poster, and the Justice Minister should be looking into the problem. Another suggested that feeding the fat fish to the fat cats could solve two problems at once. But that’s quite enough wit from the web - we don’t want to put ourselves out of a job
I know it's boring but the welfare of animals is actually a responsibility of the parliament under numerous statutes like the Animal Health and Welfare Act. The petitions committee was only doing its job. A democratic parliament has a duty to take seriously issues that are presented to it by voters if there is evidence the law is not being upheld. But then I suppose that’s another kettle of fish.
The petitions committee was responding to public representations on aquarium living arrangements. But the fishy tale hooked the sourer sections of the Scottish press, who’re always on the lookout for loony legislation - like not boiling lobsters or banning foie gras. When the economy is collapsing, cried the Fourth Estate, how dare Holyrood waste time on the fate of overweight fish with psychological disorders!
Actually, the question is really one for the press itself to answer: why did we devote so much time, editorials, comment and column inches to such a trivial tale? Aren’t there better things to write about? Scottish children are suffering worse obesity even than Siamese fighting fish, so why not more editorials about that? The answer of course is that row over betta splendens, as the fish are properly called, was a welcome relief from the economic gloom, and allowed punning subs to run pictures of exotic fish under “storm in a goldfish bowl” headlines. Commentators took a populist pop at Holyrood, for being a waste of space.
It also gave the many sane and well-balanced folk who post comments on newspaper websites a chance to vent their spleens - and boy do they have spleens to vent. Only in the Scottish blogosphere could the fate of gold fish be turned into a constitutional issue, with Labour and SNP trolls biffing each other over what the affair tells us about the legitimacy of the Scottish government. Many comments had to be removed because they were offensive.
Mind you, some of the less poisonous posts were really rather funny. The apparent antisocial behaviour of the fighting fish is down to the availability of cheap drink, said one poster, and the Justice Minister should be looking into the problem. Another suggested that feeding the fat fish to the fat cats could solve two problems at once. But that’s quite enough wit from the web - we don’t want to put ourselves out of a job
I know it's boring but the welfare of animals is actually a responsibility of the parliament under numerous statutes like the Animal Health and Welfare Act. The petitions committee was only doing its job. A democratic parliament has a duty to take seriously issues that are presented to it by voters if there is evidence the law is not being upheld. But then I suppose that’s another kettle of fish.
Sunday, March 15, 2009
Terrible Tavish
The Liberal Democrats never do things by halves. They prefer to do them by quarters and fifths. As on alcohol pricing which seems to be wrong in Scotland but right in England. And on the constitution, where the Scottish Liberal Democrat leader, Tavish Scott has called for radical constitutional change to save the Scottish economy. But not TERRIBLY radical change. The Libdems want taxation and borrowing powers for Holyrood to allow the Scottish government to finance a bold green job creation programme to counter the recession. But this is not to be confused with the SNP’s call for tax and borrowing powers and its counter-recessionary Green Deal. Oh no - that would be secession.
And don’t think there should be any kind of referendum on the Calman Commission on the Constitution, when it finally delivers the constitutional blueprint. The Liberal Democrats are utterly and completely opposed to referendums - except, er, in England and on Europe. The party is committed to a referendum on constitutional reform in Westminster, including reducing Scottish representation, in the first year of any Liberal Democrat administration. They also called recently for a referendum on withdrawal from the European Union. No, I don’t understand it either.
The Scottish Liberal Democrat antipathy toward a referendum in Scotland has never made much democratic sense, so perhaps we should welcome the fact that Tavish Scott is no longer ruling one out “for all time”. Though he isn’t ruling it in either. The idea appears to be to prevent the issue from denying the Liberal Democrats the option of forming a coalition with the SNP after the next Scottish election. The Libdems have finally realised what everyone else has known for years, that the Nationalists are actually intensely relaxed about delaying the referendum on independence. This may not be unconnected with the fact that they would almost certainly lose it, as the latest YouGov poll confirmed at the weekend. The whole point of the referendum policy was to liberate the SNP from the independence commitment - to put it into the long grass - while Alex Salmond got on with the business of governing in the Scottish parliament.
But in May 2007, Tavish Scott refused even to talk about a coalition unless the SNP abandoned its policy of a referendum on the constitution - which Salmond clearly could not do. It was an emotional spasm which now seems to have passed. Though I’m not entirely sure what has changed to clear the way for this historic compromise. Tavish and co could have remained in government; instead they opted for the wilderness. And the wilderness is a cold and lonely place.
Just consider a typical senior Liberal Democrat who is not getting any younger and yet feels he has much to contribute. He was an able minister for eight years in the Liberal-Labour coalition, and was rarely off the airwaves. Now he is, if not forgotten, then largely gone from public view. It is immensely frustrating to be a politician and not have any power. The Liberal Democrats knew what they were for back then: free personal care, tuition fees, reform of local government. Now they just don’t matter; they are the lost tribe of Scottish politics.
So, the Libdems have got to make themselves matter again, and the only way to do that is to get some kind of foothold on power through an alliance. But could it be that they are opening the way for the SNP just at the moment when the door is closing on Scottish nationalism? The latest YouGov opinion poll places Labour back in the lead in voters’ preferences for Holyrood for the first time in two years. The Nationalist minority government is becalmed, discarding manifesto promises like a sinking ship dumping cargo to keep afloat. Following the credit crisis, the whole idea of small nations with big banks trying to go it alone is discredited. Perhaps the Liberal Democrats should be making up with Labour again and looking to re-establish the partnership that delivered their greatest hits?
Well, certainly, the SNP is discovering that it is not immune to what they call “mid term blues” in Westminster - the slough that governments fall into half way through a term of office as the novelty wears off and they lose popularity. But Labour isn’t in a position to open the champagne quite yet, and the Libdems are wise to be circumspect. The financial crisis is only now transforming itself into an economic one, and Scotland is still behind the curve, as they say in the city. In places like Edinburgh people are still buying expensive cars and paying ludicrous prices for houses, like Wile E. Coyote who has run off the cliff but hasn’t succumbed to the force of gravity yet.
As the Liberal Democrat finance spokesman Vince Cable has warned, there is a 10% to 20% cut in public spending on the way, as the government tries to salvage the ruined public finances. This is going to be devastating to an economy like Scotland’s which is dominated by the public sector. The SNP Finance Secretary, John Swinney, is equally gloomy and has reportedly called on ministers to draw up a “doomsday budget” involving cuts of £2.3bn in spending on schools, hospitals and other services. The key question in Scottish politics for the medium term, therefore, is who gets blamed for the economy: Westminster, as the SNP wish, or the Scottish government. The Glenrothes by-election, and some opinion polls suggest that voters are disinclined to blame Gordon Brown. On the other hand, Alex Salmond remains by far the most popular leader in Scotland.
The battle of the cuts is unresolved. However, after this weekend I think one thing perhaps is resolved: the constitutional question. All the Scottish parties accept now that the Scottish parliament needs more powers to tax and to borrow - the difference is only one of degree. It’s devolution max all round. Independence is lying in the long grass, in a field far away, as the SNP increasingly confine their demands to “more powers” to deal with the economy. Tavish Scott yesterday called for “a true home rule parliament”. And, in time, it looks as if that is precisely what we are going to get. Though I’m not entirely sure that Gordon is on board.
And don’t think there should be any kind of referendum on the Calman Commission on the Constitution, when it finally delivers the constitutional blueprint. The Liberal Democrats are utterly and completely opposed to referendums - except, er, in England and on Europe. The party is committed to a referendum on constitutional reform in Westminster, including reducing Scottish representation, in the first year of any Liberal Democrat administration. They also called recently for a referendum on withdrawal from the European Union. No, I don’t understand it either.
The Scottish Liberal Democrat antipathy toward a referendum in Scotland has never made much democratic sense, so perhaps we should welcome the fact that Tavish Scott is no longer ruling one out “for all time”. Though he isn’t ruling it in either. The idea appears to be to prevent the issue from denying the Liberal Democrats the option of forming a coalition with the SNP after the next Scottish election. The Libdems have finally realised what everyone else has known for years, that the Nationalists are actually intensely relaxed about delaying the referendum on independence. This may not be unconnected with the fact that they would almost certainly lose it, as the latest YouGov poll confirmed at the weekend. The whole point of the referendum policy was to liberate the SNP from the independence commitment - to put it into the long grass - while Alex Salmond got on with the business of governing in the Scottish parliament.
But in May 2007, Tavish Scott refused even to talk about a coalition unless the SNP abandoned its policy of a referendum on the constitution - which Salmond clearly could not do. It was an emotional spasm which now seems to have passed. Though I’m not entirely sure what has changed to clear the way for this historic compromise. Tavish and co could have remained in government; instead they opted for the wilderness. And the wilderness is a cold and lonely place.
Just consider a typical senior Liberal Democrat who is not getting any younger and yet feels he has much to contribute. He was an able minister for eight years in the Liberal-Labour coalition, and was rarely off the airwaves. Now he is, if not forgotten, then largely gone from public view. It is immensely frustrating to be a politician and not have any power. The Liberal Democrats knew what they were for back then: free personal care, tuition fees, reform of local government. Now they just don’t matter; they are the lost tribe of Scottish politics.
So, the Libdems have got to make themselves matter again, and the only way to do that is to get some kind of foothold on power through an alliance. But could it be that they are opening the way for the SNP just at the moment when the door is closing on Scottish nationalism? The latest YouGov opinion poll places Labour back in the lead in voters’ preferences for Holyrood for the first time in two years. The Nationalist minority government is becalmed, discarding manifesto promises like a sinking ship dumping cargo to keep afloat. Following the credit crisis, the whole idea of small nations with big banks trying to go it alone is discredited. Perhaps the Liberal Democrats should be making up with Labour again and looking to re-establish the partnership that delivered their greatest hits?
Well, certainly, the SNP is discovering that it is not immune to what they call “mid term blues” in Westminster - the slough that governments fall into half way through a term of office as the novelty wears off and they lose popularity. But Labour isn’t in a position to open the champagne quite yet, and the Libdems are wise to be circumspect. The financial crisis is only now transforming itself into an economic one, and Scotland is still behind the curve, as they say in the city. In places like Edinburgh people are still buying expensive cars and paying ludicrous prices for houses, like Wile E. Coyote who has run off the cliff but hasn’t succumbed to the force of gravity yet.
As the Liberal Democrat finance spokesman Vince Cable has warned, there is a 10% to 20% cut in public spending on the way, as the government tries to salvage the ruined public finances. This is going to be devastating to an economy like Scotland’s which is dominated by the public sector. The SNP Finance Secretary, John Swinney, is equally gloomy and has reportedly called on ministers to draw up a “doomsday budget” involving cuts of £2.3bn in spending on schools, hospitals and other services. The key question in Scottish politics for the medium term, therefore, is who gets blamed for the economy: Westminster, as the SNP wish, or the Scottish government. The Glenrothes by-election, and some opinion polls suggest that voters are disinclined to blame Gordon Brown. On the other hand, Alex Salmond remains by far the most popular leader in Scotland.
The battle of the cuts is unresolved. However, after this weekend I think one thing perhaps is resolved: the constitutional question. All the Scottish parties accept now that the Scottish parliament needs more powers to tax and to borrow - the difference is only one of degree. It’s devolution max all round. Independence is lying in the long grass, in a field far away, as the SNP increasingly confine their demands to “more powers” to deal with the economy. Tavish Scott yesterday called for “a true home rule parliament”. And, in time, it looks as if that is precisely what we are going to get. Though I’m not entirely sure that Gordon is on board.
Monday, March 02, 2009
The Pension Crunch
The revelation that Fred the Shred’s pension is actually going to cost £30m, and not the £16 million quoted by RBS, has underlined a salient fact about pensions: everyone underestimates the cost of them. This is partly because the pension providers tend not to take inflation into account when calculating the lifetime cost of pensions, and make optimistic assumptions about investment returns. They know that if people are told the truth about how much they really need to save they run and hide.
You want numbers? A sixty year old retiring today and seeking a £30,000 a year pension, inflation linked, requires a pension ‘pot’ of over £1,000,000, according to fairinvestment.co.uk. The average pension ‘pot’ of a worker retiring today is actually £35,000. Do the math. Only bankers, politicians and employees of public corporations like the BBC get pensions that actually deliver. That’s because they don’t pay the cost of them - we do. One fifth of your council tax goes to pay the pensions of the people collecting it.
But central government is at it as well. The government claims that the current public sector pension bill is around £600bn when everyone in the industry knows that it will be well over £1 trillion. One of the untold scandals of the Brown years is the way that this colossal expense has been kept off the public books. It is “unfunded’ in the jargon, which means the government pretends it isn’t there. But of course it is there and someone has to pay for it: around £40,000 for every household in Britain over the next 20 years. The alert among you will notice that this is actually more than those people are saving for their own pensions - which is of course madness.
Now, I have no animosity toward public sector workers, who deserve what they get - which often isn’t a lot. However, we are creating a kind of pensions apartheid here. Nine out of ten public sector workers still have copper-bottomed final salary pensions against only one in ten private sector workers. The public sector pension used to be a compensation for lower pay in the public sphere, but that’s all changed. State employees now have higher pay than private sector employees and also work fewer hours. And the disparity is growing very fast in the current recession as a pay freeze is imposed across the entire private sector while public sector pay continues to increase. Moreover, the private pension savers have just seen the value of their pensions collapse in the stock-market crash by 40% or more.
Everyone knows that this cannot go on, but the government is in denial - just as it was about the housing market 2 years ago. The pension deficit could split society and destroy services like the NHS - it really is as serious as that. The root cause is the failure of successive governments to realistically cost public pensions and to regulate the private pensions industry, which has performed disgracefully over the last two decades. The average personal pension fund at retirement, according to Prudential, produces just £2,000 a year. And most of this is wiped out by the means test on the state pension credit - another disgraceful fiddle of which the government should be ashamed. And remember that forty percent of workers don’t contribute to any kind of pension at all and will be left wholly reliant on the basic state pension or £124 a week.
Many people have been relying on the value of their homes to generate an income in retirement. Well, the writing really is on the wall here because UK house prices have fallen 20% since August 2007, placing two million in negative equity, and prices are expected to fall by another 10-15%. No future government is going to allow another house price boom after the present disaster. So anyone who believes their house will look after them in retirement is living in a fool’s paradise.
I know this is alarming and complicated, and that pensions are about as interesting as programming a video recorder, but we ignore these numbers at our peril. I have been tracking my own personal pension for many years and been appalled at the poor returns - largely a result of high commissions taken by financial “advisers” and because pension savers are more or less compelled to place their money in equities to generate income for the pension providers. Every ten or twenty years shares crash and the pension funds rarely regain the lost value. Honest financial advisers - there are some - are deeply embarrassed about the poor returns from pensions industry and admit that most of the tax relief on pensions is diverted into salaries and bonuses for the pensions industry.
The terrifying reality is that, as Britain’s population ages, the means to sustain any kind of wellbeing in retirement is simply not there. Public sector pensions are unsustainable and private ones are risible. Our collective denial about pensions is similar to our refusal to face up to the debt problem during the credit boom. That too was clearly unsustainable, but the government and the financial services sector observed a conspiracy of silence about it - until it turned into a suicide pact. Voters are also implicated, of course, for thinking that houses would always rise in value, which is like believing money grows on trees.
Actually, the government is still hoping that trees can be persuaded to produce fivers instead of leaves. Last week the Bank of England began quantitative easing, printing money, which it hopes will generate inflation and erode the value of the public pension debt as well as the debts of the banks. What this really means is a transfer of wealth from people who have saved, to people who haven’t. It is a desperate and dishonourable way out of the pensions hole - and it won’t work. Inflation may erode the value of the public sector pension bill, but only at the cost of increasing entitlement, because it will throw more public and private pensioners into poverty and into the arms of the state.
From Weimar Germany to Mugabe’s Zimbabwe, the lesson of history is that inflation only makes large debts disappear at immense economic cost. There’s no free lunch. Future historians will be astonished that the government actually penalised savers at the moment when the country desperately needs to pay down debt and save for the future. But our children, as they pay for our mistakes, will look back on the noughties with a mixture of scorn and disbelief. We are generation dumb, and getting dumber.
You want numbers? A sixty year old retiring today and seeking a £30,000 a year pension, inflation linked, requires a pension ‘pot’ of over £1,000,000, according to fairinvestment.co.uk. The average pension ‘pot’ of a worker retiring today is actually £35,000. Do the math. Only bankers, politicians and employees of public corporations like the BBC get pensions that actually deliver. That’s because they don’t pay the cost of them - we do. One fifth of your council tax goes to pay the pensions of the people collecting it.
But central government is at it as well. The government claims that the current public sector pension bill is around £600bn when everyone in the industry knows that it will be well over £1 trillion. One of the untold scandals of the Brown years is the way that this colossal expense has been kept off the public books. It is “unfunded’ in the jargon, which means the government pretends it isn’t there. But of course it is there and someone has to pay for it: around £40,000 for every household in Britain over the next 20 years. The alert among you will notice that this is actually more than those people are saving for their own pensions - which is of course madness.
Now, I have no animosity toward public sector workers, who deserve what they get - which often isn’t a lot. However, we are creating a kind of pensions apartheid here. Nine out of ten public sector workers still have copper-bottomed final salary pensions against only one in ten private sector workers. The public sector pension used to be a compensation for lower pay in the public sphere, but that’s all changed. State employees now have higher pay than private sector employees and also work fewer hours. And the disparity is growing very fast in the current recession as a pay freeze is imposed across the entire private sector while public sector pay continues to increase. Moreover, the private pension savers have just seen the value of their pensions collapse in the stock-market crash by 40% or more.
Everyone knows that this cannot go on, but the government is in denial - just as it was about the housing market 2 years ago. The pension deficit could split society and destroy services like the NHS - it really is as serious as that. The root cause is the failure of successive governments to realistically cost public pensions and to regulate the private pensions industry, which has performed disgracefully over the last two decades. The average personal pension fund at retirement, according to Prudential, produces just £2,000 a year. And most of this is wiped out by the means test on the state pension credit - another disgraceful fiddle of which the government should be ashamed. And remember that forty percent of workers don’t contribute to any kind of pension at all and will be left wholly reliant on the basic state pension or £124 a week.
Many people have been relying on the value of their homes to generate an income in retirement. Well, the writing really is on the wall here because UK house prices have fallen 20% since August 2007, placing two million in negative equity, and prices are expected to fall by another 10-15%. No future government is going to allow another house price boom after the present disaster. So anyone who believes their house will look after them in retirement is living in a fool’s paradise.
I know this is alarming and complicated, and that pensions are about as interesting as programming a video recorder, but we ignore these numbers at our peril. I have been tracking my own personal pension for many years and been appalled at the poor returns - largely a result of high commissions taken by financial “advisers” and because pension savers are more or less compelled to place their money in equities to generate income for the pension providers. Every ten or twenty years shares crash and the pension funds rarely regain the lost value. Honest financial advisers - there are some - are deeply embarrassed about the poor returns from pensions industry and admit that most of the tax relief on pensions is diverted into salaries and bonuses for the pensions industry.
The terrifying reality is that, as Britain’s population ages, the means to sustain any kind of wellbeing in retirement is simply not there. Public sector pensions are unsustainable and private ones are risible. Our collective denial about pensions is similar to our refusal to face up to the debt problem during the credit boom. That too was clearly unsustainable, but the government and the financial services sector observed a conspiracy of silence about it - until it turned into a suicide pact. Voters are also implicated, of course, for thinking that houses would always rise in value, which is like believing money grows on trees.
Actually, the government is still hoping that trees can be persuaded to produce fivers instead of leaves. Last week the Bank of England began quantitative easing, printing money, which it hopes will generate inflation and erode the value of the public pension debt as well as the debts of the banks. What this really means is a transfer of wealth from people who have saved, to people who haven’t. It is a desperate and dishonourable way out of the pensions hole - and it won’t work. Inflation may erode the value of the public sector pension bill, but only at the cost of increasing entitlement, because it will throw more public and private pensioners into poverty and into the arms of the state.
From Weimar Germany to Mugabe’s Zimbabwe, the lesson of history is that inflation only makes large debts disappear at immense economic cost. There’s no free lunch. Future historians will be astonished that the government actually penalised savers at the moment when the country desperately needs to pay down debt and save for the future. But our children, as they pay for our mistakes, will look back on the noughties with a mixture of scorn and disbelief. We are generation dumb, and getting dumber.
Sunday, February 15, 2009
White hell
Britain ground to a halt last week as the country was gripped by white hell. Well, what they really meant was that there was some snow in London. The London transport system promptly ground to a halt, schools closed, factories shut and newspapers suffered superlative fatigue. There were the heart-warming stories about meals on wheels on ice, and about the human cost in ruined lives. Climate change deniers insisted that global warming is a myth. Health and safety officials ordered people not to build snowmen or use sledges without airbags and full body armour.
It’s strange, but somehow when it snows in Scotland, it just isn’t news, at least not network news - it's just weather. Of course, snow in Hide Park is news, because it doesn’t happen very often, as are all the snowmen and sledges and bumped cars. But it is LOCAL news. The perennial problem with the media in this country is that local news in London is assumed to be news everywhere else. Last week was confirmation that the metropolitan media is the most parochial in the country. Its news values are worse than the most local of local rags, precisely because it can’t see beyond its own doorstep.
When snow fall in Scotland there are all the stories we have seen in the past week, and more. We have mountain rescues, islands cut off, remote farmers isolated. The schools don’t generally close and public transport remains active but with our mountain landscape it’s a lot more interesting to look at. However, what you will never see is the BBC’s national news bulletin devoting half its slot to covering snow chaos in Scotland. It is only when weather happens in London that it is thought to be of national significance. The rest of the country is assumed to be fascinated with buses not moving in Regent Street and Boris Johnson trundling his bike in the slush.
I’m not making a Scottish whinge here - well, perhaps I am a bit- but it is a legitimate whinge. Metrocentrism was supposed to have been stamped out after the BBC’s Impartiality Review last year. But hiring a few newsreaders with Scottish accents doesn’t disguise the reality that the network bulletins are still utterly preoccupied with whatever is happening the in the South East.
I don’t know why we take this from our ‘national’ broadcaster, I really don’t. The King report two years ago for the BBC Trust was scathing of the southern bias of BBC network news and current affairs. We were promised that things would change. But they haven’t. Look at the coverage on the network bulletins of the Scottish budget crisis. They’re much more interested in beavers. Maybe we should all grow beards and build dams.
It’s strange, but somehow when it snows in Scotland, it just isn’t news, at least not network news - it's just weather. Of course, snow in Hide Park is news, because it doesn’t happen very often, as are all the snowmen and sledges and bumped cars. But it is LOCAL news. The perennial problem with the media in this country is that local news in London is assumed to be news everywhere else. Last week was confirmation that the metropolitan media is the most parochial in the country. Its news values are worse than the most local of local rags, precisely because it can’t see beyond its own doorstep.
When snow fall in Scotland there are all the stories we have seen in the past week, and more. We have mountain rescues, islands cut off, remote farmers isolated. The schools don’t generally close and public transport remains active but with our mountain landscape it’s a lot more interesting to look at. However, what you will never see is the BBC’s national news bulletin devoting half its slot to covering snow chaos in Scotland. It is only when weather happens in London that it is thought to be of national significance. The rest of the country is assumed to be fascinated with buses not moving in Regent Street and Boris Johnson trundling his bike in the slush.
I’m not making a Scottish whinge here - well, perhaps I am a bit- but it is a legitimate whinge. Metrocentrism was supposed to have been stamped out after the BBC’s Impartiality Review last year. But hiring a few newsreaders with Scottish accents doesn’t disguise the reality that the network bulletins are still utterly preoccupied with whatever is happening the in the South East.
I don’t know why we take this from our ‘national’ broadcaster, I really don’t. The King report two years ago for the BBC Trust was scathing of the southern bias of BBC network news and current affairs. We were promised that things would change. But they haven’t. Look at the coverage on the network bulletins of the Scottish budget crisis. They’re much more interested in beavers. Maybe we should all grow beards and build dams.
Sexual Offensive Bill
The First Minister, Alex Salmond, continued his daring manifesto striptease last week. First it was student debts, first time buyer grants and new police that dropped to the floor. Now the bigger items of clothing are being removed, like Local Income Tax. But fear not, because the SNP’s moral guardian, Justice Secretary Kenny MacAskill, has come to the rescue with an armful of daft legislation to cover up the FM’s wobbly bits.
Judge Kenny has already tried to stop under twenty-ones from buying drink in an off-license, even though they may be married soldiers back from Afghanistan. He’s now topped that by calling for teenage girls to be prosecuted for having sex under the age of 16. The Sexual Offences Bill now before Holyrood would make it illegal for girls as well as boys to have consensual sex with each other if they are underage.
Does the government realise just how many teenagers it is going to criminalise as a result of this extraordinary exercise in sexual hygiene? Like hundreds of thousands of people, I had consensual intercourse with my girlfriend before I was sixteen, which means I’m technically a rapist. But she was also underage, which means she could be prosecuted too under the new law. I’d better shop her right away.
How is the justice system going to cope with the flood of tweeny sex-criminals? A BBC survey two years ago revealed that at least a third of teenagers have sex below the age of consent, and that is widely thought to be an under-estimate. . And just how is Kenny going to know when they are all having illegal nooky? Perhaps all those speech-activated security cameras that are being put up around Glasgow will do the job. Whenever one of them picks up heavy breathing the sex police will be onto the couple in a shot. Come on now you two, get your kit on, you’re nicked.
Perhaps Kenny could take a leaf out of the Ysgol Dyffryin Teifi school in Ceredigion Wales (crazy name, crazy school) which has placed CCTV cameras in secondary school toilets. It’s not quite clear who is going to monitor this footage since the teachers would presumably place themselves on the sex offenders register if they looked at it. But a rumour that I have just invented suggests that the Justice Secretary, may be minded to introduce toilet tv cameras into every home in Scotland so that he can know what everyone is really up to.
I’ve heard of the nanny state, but this is ridiculous. The only way the Scottish government is going to stop young people having sex is to bring back chastity belts and bromide. But I’d better stop right there in case I give the sex police any more bright ideas.
Judge Kenny has already tried to stop under twenty-ones from buying drink in an off-license, even though they may be married soldiers back from Afghanistan. He’s now topped that by calling for teenage girls to be prosecuted for having sex under the age of 16. The Sexual Offences Bill now before Holyrood would make it illegal for girls as well as boys to have consensual sex with each other if they are underage.
Does the government realise just how many teenagers it is going to criminalise as a result of this extraordinary exercise in sexual hygiene? Like hundreds of thousands of people, I had consensual intercourse with my girlfriend before I was sixteen, which means I’m technically a rapist. But she was also underage, which means she could be prosecuted too under the new law. I’d better shop her right away.
How is the justice system going to cope with the flood of tweeny sex-criminals? A BBC survey two years ago revealed that at least a third of teenagers have sex below the age of consent, and that is widely thought to be an under-estimate. . And just how is Kenny going to know when they are all having illegal nooky? Perhaps all those speech-activated security cameras that are being put up around Glasgow will do the job. Whenever one of them picks up heavy breathing the sex police will be onto the couple in a shot. Come on now you two, get your kit on, you’re nicked.
Perhaps Kenny could take a leaf out of the Ysgol Dyffryin Teifi school in Ceredigion Wales (crazy name, crazy school) which has placed CCTV cameras in secondary school toilets. It’s not quite clear who is going to monitor this footage since the teachers would presumably place themselves on the sex offenders register if they looked at it. But a rumour that I have just invented suggests that the Justice Secretary, may be minded to introduce toilet tv cameras into every home in Scotland so that he can know what everyone is really up to.
I’ve heard of the nanny state, but this is ridiculous. The only way the Scottish government is going to stop young people having sex is to bring back chastity belts and bromide. But I’d better stop right there in case I give the sex police any more bright ideas.
The banality of bankers
Hannah Arendt used to talk about the “banality of evil”; last week we saw the banality of bankers. There they sat, the Sir this and Lord thats, uttering po-faced clichés and over-rehearsed apologies to ratty MPs in Westminster. The Sun called them “scumbag millionaires” but they were really a bit of an anticlimax, and far to dull to make proper villains. Goodwin and co were revealed to be just like the countless interchangeable suits who sit around thousands of corporate boards and shuffle paper around a million offices every day; uninspiring bureaucrats whose vision extends no further than the latest management fad.
They’re the people you remember from school - the ones who got their homework in on time but lacked any kind of inspiration or independence of thought. The ones who joined the right societies at university, studied subjects of mind-numbing tedium, and then polished up their CVs for the graduate milk round. They were supposed to be the safe pairs of hands these accountants and actuaries, with their mousy wives living in their characterless suburban houses. Secure and boring. But somehow they grey men managed to blow up the world.
How did it happen? When did it happen? Without a shot being fired, these people not only took over the commanding heights of the economy, they infiltrated the heart of government, sitting on countless quangos and inquiries, advising ministers and civil servants, creating a society in their own image. How did we let them do it? And where did these boring bean-counters and shiny-bottoms get the wherewithal to engineer the greatest financial crisis in history?
Well, it all goes back to the 1980s when the ruminant number crunchers became infected with the virus of greed and turned into voracious financial predators. It was the great financial boom ignited by Margaret Thatcher’s privatisation policies that transformed plodding corporate clones into to reckless gamblers and risk-takers. With deregulated financial markets, the suits discovered that they suddenly had access to the ‘dumb’ wealth of society which had been sitting passively in pension funds, insurance funds, government departments. Deregulation encouraged financial ‘innovation’ and the creation of ‘products’ like dodgy endowment mortgages or “personal” pensions that delivered little apart from commissions.
But it was the sale of public utilities that offered the suits their opportunity to cash in on a grand scale. The sale of state assets in rail, airports, communications gas and electricity yielded billions in commissions and fees that flooded into the offices of the grey men turning them into privatisation tycoons. Look at how well they’d done, selling the country back its own property and calling it popular capitalism. They set up remuneration committees staffed by their friends which awarded higher and higher salaries to themselves under the guise of incentive schemes. The bonus culture was born.
The lords of financial misrule weren’t actually making anything - building companies or creating new markets - but they began to regard themselves as financial engineers, masters of the universe, able to create wealth apparently out of nothing. Ten they started on the property market - a massive pyramid scheme, so huge and complex that it took over twenty years to construct and will take almost as long for society to pay off.
A pyramid scheme, like Bernie Madoff’s Ponzi scheme, is a way of inflating asset prices by creating an artificial scarcity fuelled by buying mania. Like the South Sea Bubble, inflated asset prices only last for as long as ever larger numbers of people can be persuaded to invest in them. The global real estate boom was the greatest asset bubble in history, as house prices in countries like Britain tripled with in a decade. This created trillions worth of paper wealth which was managed and manipulated by the bloated financial services industry which had now begun to crowd out other productive forms of economic activity.
It’s an open secret that the bankers realised that the boom couldn’t last forever, but they did everything they could to prolong it. Banks like Northern Rock and HBOS started selling 125% mortgages and the infamous sub-prime loans to people who could never repay. Then there was ‘securitization’. Instead of just holding on to mortgages for the duration of the loan, the banks started selling packages of mortgage in bonds to other investors and used the proceeds to lend ever more mortgages. They invented sophisticated derivatives like collateralised debt obligations and credit default swaps which used complexity to disguise risk.They started lending on every greater ratios of their core capital, “leveraging” loans by thirty or forty to one. Their command of the language of the balance sheet prevented the rest of us from fully understanding what they were doing. Just take a look at an RBS balance sheet - they’re openly available on the web - and try to work out whether or not it is solvent.
Most of the dodgy mortgage-backed bonds were bought by savers in Asian countries, who are now feeling extremely sore. Back home in Britain people stopped saving altogether as the suits found ever more ingenious ways of ensnaring them in debt - like credit cards, with 25% interest rates. Then there were student loans: an entire generation of graduates landed with £20,000 debts. Governments were persuaded to take out PFI schemes - which are a bit like endowment mortgages for public projects like hospitals and schools. Our children will be paying the cost of these and other financial innovations for decades.
As I say, the bankers knew perfectly well that a real estate asset bubble couldn’t last forever. But they believed that if they got big enough, fast enough, they would be too big to fail when the music stopped. This was why the former HBOS executive, Sir James Crosby, launched his dash for growth, which even the Financial Services Authority realised was reckless insanity. When Lloyds ‘rescued’ HBOS by taking it over last year, they too hoped that the resulting bank behemoth would be too big to fail - that the bigger the losses the more likely the government would always step in with public money.
This was why the Lloyds boss, Sir Eric Daniels, largely dispensed with due diligence before the HBOS take-over- he didn’t want to know how bad the HBOS books really were. And in a sense, he was right; they were all right. As we saw last week, the government has had no choice but to step in to save the bankers from the consequences of their own irresponsibility. After the privatisation of gains comes the socialisation of the losses. It’s been the crime of the century, perhaps of the millennium, and the colourless culprits are getting clean away.
They’re the people you remember from school - the ones who got their homework in on time but lacked any kind of inspiration or independence of thought. The ones who joined the right societies at university, studied subjects of mind-numbing tedium, and then polished up their CVs for the graduate milk round. They were supposed to be the safe pairs of hands these accountants and actuaries, with their mousy wives living in their characterless suburban houses. Secure and boring. But somehow they grey men managed to blow up the world.
How did it happen? When did it happen? Without a shot being fired, these people not only took over the commanding heights of the economy, they infiltrated the heart of government, sitting on countless quangos and inquiries, advising ministers and civil servants, creating a society in their own image. How did we let them do it? And where did these boring bean-counters and shiny-bottoms get the wherewithal to engineer the greatest financial crisis in history?
Well, it all goes back to the 1980s when the ruminant number crunchers became infected with the virus of greed and turned into voracious financial predators. It was the great financial boom ignited by Margaret Thatcher’s privatisation policies that transformed plodding corporate clones into to reckless gamblers and risk-takers. With deregulated financial markets, the suits discovered that they suddenly had access to the ‘dumb’ wealth of society which had been sitting passively in pension funds, insurance funds, government departments. Deregulation encouraged financial ‘innovation’ and the creation of ‘products’ like dodgy endowment mortgages or “personal” pensions that delivered little apart from commissions.
But it was the sale of public utilities that offered the suits their opportunity to cash in on a grand scale. The sale of state assets in rail, airports, communications gas and electricity yielded billions in commissions and fees that flooded into the offices of the grey men turning them into privatisation tycoons. Look at how well they’d done, selling the country back its own property and calling it popular capitalism. They set up remuneration committees staffed by their friends which awarded higher and higher salaries to themselves under the guise of incentive schemes. The bonus culture was born.
The lords of financial misrule weren’t actually making anything - building companies or creating new markets - but they began to regard themselves as financial engineers, masters of the universe, able to create wealth apparently out of nothing. Ten they started on the property market - a massive pyramid scheme, so huge and complex that it took over twenty years to construct and will take almost as long for society to pay off.
A pyramid scheme, like Bernie Madoff’s Ponzi scheme, is a way of inflating asset prices by creating an artificial scarcity fuelled by buying mania. Like the South Sea Bubble, inflated asset prices only last for as long as ever larger numbers of people can be persuaded to invest in them. The global real estate boom was the greatest asset bubble in history, as house prices in countries like Britain tripled with in a decade. This created trillions worth of paper wealth which was managed and manipulated by the bloated financial services industry which had now begun to crowd out other productive forms of economic activity.
It’s an open secret that the bankers realised that the boom couldn’t last forever, but they did everything they could to prolong it. Banks like Northern Rock and HBOS started selling 125% mortgages and the infamous sub-prime loans to people who could never repay. Then there was ‘securitization’. Instead of just holding on to mortgages for the duration of the loan, the banks started selling packages of mortgage in bonds to other investors and used the proceeds to lend ever more mortgages. They invented sophisticated derivatives like collateralised debt obligations and credit default swaps which used complexity to disguise risk.They started lending on every greater ratios of their core capital, “leveraging” loans by thirty or forty to one. Their command of the language of the balance sheet prevented the rest of us from fully understanding what they were doing. Just take a look at an RBS balance sheet - they’re openly available on the web - and try to work out whether or not it is solvent.
Most of the dodgy mortgage-backed bonds were bought by savers in Asian countries, who are now feeling extremely sore. Back home in Britain people stopped saving altogether as the suits found ever more ingenious ways of ensnaring them in debt - like credit cards, with 25% interest rates. Then there were student loans: an entire generation of graduates landed with £20,000 debts. Governments were persuaded to take out PFI schemes - which are a bit like endowment mortgages for public projects like hospitals and schools. Our children will be paying the cost of these and other financial innovations for decades.
As I say, the bankers knew perfectly well that a real estate asset bubble couldn’t last forever. But they believed that if they got big enough, fast enough, they would be too big to fail when the music stopped. This was why the former HBOS executive, Sir James Crosby, launched his dash for growth, which even the Financial Services Authority realised was reckless insanity. When Lloyds ‘rescued’ HBOS by taking it over last year, they too hoped that the resulting bank behemoth would be too big to fail - that the bigger the losses the more likely the government would always step in with public money.
This was why the Lloyds boss, Sir Eric Daniels, largely dispensed with due diligence before the HBOS take-over- he didn’t want to know how bad the HBOS books really were. And in a sense, he was right; they were all right. As we saw last week, the government has had no choice but to step in to save the bankers from the consequences of their own irresponsibility. After the privatisation of gains comes the socialisation of the losses. It’s been the crime of the century, perhaps of the millennium, and the colourless culprits are getting clean away.
Rector Reflections
The most difficult thing was explaining why I wanted to do it. As the 50th Rector of Edinburgh University, following my election last week by students and staff, I will now be chairing the University Court, the governing body of one of Scotland’s great cultural institutions. It’s clearly an immense honour and a privilege, and - I hope - a lot of fun since being Rector involves associating with some of the brightest and liveliest minds in the country and speaking on the great moral issues of the day.
But as I was trundling around lecture theatres and dinner halls canvassing support, I kept being assailed by the question why? Why did I want the hassle? It became increasingly difficult to give the same pat answer without sounding just a little false. The subtext of the question was clearly that there must be some kind of ulterior motive. People don’t just take on these roles for nothing these days - puh-leese - there must be something in it for me. The students didn’t want to condemn me for it; they just wanted to know what it was.
The more I answered the question the more I started questioning my own motives. I’m not a daytime TV celebrity or a full time politician, so there is no real PR benefit. The job involves no salary or comfy expense account and, so far as I know, there are no lobbying companies seeking rectors-for-hire. Apart from a lifetime membership of a unique club which includes Gladstone, Churchill, and Lloyd George, it’s not clear what the material rewards really are of being Rector of Edinburgh University. Perhaps I should have just said: ‘because it’s there’.
So, why did I stand. Well, the first reason of course, was that I was asked to - and sometimes that is incentive enough. Call it vanity, but it is very hard not to respond when you’re called out of the blue by a group of bright undergraduates from a wide range of political backgrounds, who seem to think that you stand for what they stand for. After thirty years in the tawdry trade of journalism, it’s nice to be told that you actually stand for anything at all- even if you’re not quite sure what it is. When you realise that the students are mainly interested in you because you are not one of the other candidates the ego boost diminishes just a little. But it was still immensely flattering to be told that I could take on, in electoral combat, someone like Lord George Foulkes, a former cabinet minister, one of the most experienced political operators around. Or that I could beat the Respect MP, George Galloway, one of the greatest parliamentary orators of his generation and the man who faced down the US Congress over those alleged oil dealings with Saddam.
But you rapidly discover that it’s not really about the candidate, but the effectiveness of the campaign - which in my case was led by the dynamic Edinburgh undergraduate Devin Dunseath, and devised by the President of the Edinburgh University Students Association, Adam Ramsay, whose sometimes shambolic appearance disguises one of the sharpest political brains I have come across. Certainly, my campaign worked and delivered one of the largest votes in the history of rectorial politics - something of which I am immensely proud. I haven’t stood in a competitive election since I left school, but political inexperience turned out to be an advantage. There is such a depth of cynicism about politics at all levels now, that just being a politician has become an electoral handicap - at least in an election like this.
Of course we had policies on student debt, the accommodation crisis, the quality of teaching and such like, as well as on broader issues like Gaza. But being independent of any party line was very important as was being remote from parliamentary sleaze. The Lords-for-hire scandal broke just as the campaign got underway, inflicting immense collateral damage on the unfortunate Lord Foulkes. While he'd broken no rules by peforming parliamentary services for the international law firm Eversheds, it was very hard for him not to suffer guilt by association. There was a whole range of issues which made Lord Foulkes’s campaign an uphill struggle - not least his record of support for university top up fees, the Iraq war and identity cards. He fought a very dignified and effective campaign for all that.
But the hyper-cynicism that has afflicted our political culture has left us in a very difficult situation. The way things are going, not being a politicians may be the best way of winning elections. Even my uncertain delivery in the hustings debates, where I was no match for my rivals’ oratorical skill, added in a curious way to my credibility. I was clearly not comfortable selling myself and I struggled with the stilted discourse of electoral politics, where what you don't say is as important as what you do.
So what now? Well, there will be little opportunity for motivational navel-gazing because Universities are heading for difficult times. Budgets are going to be under immense pressure. Graduates, burdened with £20,000 debts, are going to be dumped onto a jobs market that no longer wants them - at least not in the numbers of the last ten years. Universities are in the front line of the financial crisis, and it is going to require hard lobbying to remind governments that investment in higher education is even more important in an economic downturn. There’s a whole range of issues requiring attention. So, once I find out what I’m doing it for, I’ll let you know.
But as I was trundling around lecture theatres and dinner halls canvassing support, I kept being assailed by the question why? Why did I want the hassle? It became increasingly difficult to give the same pat answer without sounding just a little false. The subtext of the question was clearly that there must be some kind of ulterior motive. People don’t just take on these roles for nothing these days - puh-leese - there must be something in it for me. The students didn’t want to condemn me for it; they just wanted to know what it was.
The more I answered the question the more I started questioning my own motives. I’m not a daytime TV celebrity or a full time politician, so there is no real PR benefit. The job involves no salary or comfy expense account and, so far as I know, there are no lobbying companies seeking rectors-for-hire. Apart from a lifetime membership of a unique club which includes Gladstone, Churchill, and Lloyd George, it’s not clear what the material rewards really are of being Rector of Edinburgh University. Perhaps I should have just said: ‘because it’s there’.
So, why did I stand. Well, the first reason of course, was that I was asked to - and sometimes that is incentive enough. Call it vanity, but it is very hard not to respond when you’re called out of the blue by a group of bright undergraduates from a wide range of political backgrounds, who seem to think that you stand for what they stand for. After thirty years in the tawdry trade of journalism, it’s nice to be told that you actually stand for anything at all- even if you’re not quite sure what it is. When you realise that the students are mainly interested in you because you are not one of the other candidates the ego boost diminishes just a little. But it was still immensely flattering to be told that I could take on, in electoral combat, someone like Lord George Foulkes, a former cabinet minister, one of the most experienced political operators around. Or that I could beat the Respect MP, George Galloway, one of the greatest parliamentary orators of his generation and the man who faced down the US Congress over those alleged oil dealings with Saddam.
But you rapidly discover that it’s not really about the candidate, but the effectiveness of the campaign - which in my case was led by the dynamic Edinburgh undergraduate Devin Dunseath, and devised by the President of the Edinburgh University Students Association, Adam Ramsay, whose sometimes shambolic appearance disguises one of the sharpest political brains I have come across. Certainly, my campaign worked and delivered one of the largest votes in the history of rectorial politics - something of which I am immensely proud. I haven’t stood in a competitive election since I left school, but political inexperience turned out to be an advantage. There is such a depth of cynicism about politics at all levels now, that just being a politician has become an electoral handicap - at least in an election like this.
Of course we had policies on student debt, the accommodation crisis, the quality of teaching and such like, as well as on broader issues like Gaza. But being independent of any party line was very important as was being remote from parliamentary sleaze. The Lords-for-hire scandal broke just as the campaign got underway, inflicting immense collateral damage on the unfortunate Lord Foulkes. While he'd broken no rules by peforming parliamentary services for the international law firm Eversheds, it was very hard for him not to suffer guilt by association. There was a whole range of issues which made Lord Foulkes’s campaign an uphill struggle - not least his record of support for university top up fees, the Iraq war and identity cards. He fought a very dignified and effective campaign for all that.
But the hyper-cynicism that has afflicted our political culture has left us in a very difficult situation. The way things are going, not being a politicians may be the best way of winning elections. Even my uncertain delivery in the hustings debates, where I was no match for my rivals’ oratorical skill, added in a curious way to my credibility. I was clearly not comfortable selling myself and I struggled with the stilted discourse of electoral politics, where what you don't say is as important as what you do.
So what now? Well, there will be little opportunity for motivational navel-gazing because Universities are heading for difficult times. Budgets are going to be under immense pressure. Graduates, burdened with £20,000 debts, are going to be dumped onto a jobs market that no longer wants them - at least not in the numbers of the last ten years. Universities are in the front line of the financial crisis, and it is going to require hard lobbying to remind governments that investment in higher education is even more important in an economic downturn. There’s a whole range of issues requiring attention. So, once I find out what I’m doing it for, I’ll let you know.
Monday, February 09, 2009
Hate speak - look who's talking.
Yesterday, I committed an act of hate speak. Upon reflection I have decided to apologise unreservedly for remarks I made about Gordon Brown in the Sunday Herald. In the heat of the moment I wrote that: “To describe Gordon as an unmade bed is an insult to teenage bedrooms”. This was derogatory and I offer my sincere apologies to the teenage community for suggesting that they are deficient in their domestic arrangements.
Further I would like to apologise to the bedroom community for any pain and distress caused by a comparison with the Prime Minister’s state of dress. Finally, may I apologise to Gordon Brown, who has himself the target of hate speak from the Gauleiter of the Top Gear Nazi Party, Herr Jeremy Clarkson, and who is in no way untidily dressed, exhausted, not looking 100% or any of the other things I may or may not have said. And while I’m at it, let me issue a prophylactic apology to Britain’s petrol heads for comparing the presenter of their favourite television programme to a member of the far right.
Sadly, I’m only half joking here. I’m really not sure what is acceptable to say any more, in public or private, after this astonishing week in which Orwellian thought crime became a potent reality in the British media. A kind of madness has infected the country - an incomprehensibe witch-hunt for petty offence. I’m no apologist for Jeremy Clarkson, but I don't believe Scots are racially offended by his description of the Prime Minister as a “one-eyed Scottish idiot”? I’m Scottish and I’m not offended, and I don’t need to be defended from people like Clarkson by self-appointed cultural guardians or rent-a-quote politicians. I’m frequently called an idiot myself and I refuse to take offence at the description.
If calling someone Scottish or English or an idiot or one-eyed is to be outlawed then a lot of books are going to have to be burnt and most Scottish comedians will be joining the dole queues. The Declaration of Arbroath will have to be banned as will the National Anthem with its talk of crushing rebellious Scots. Programmes like Mock the Week and Have I Got News For You are toast. I’m a republican, but I can see that jokes, such as the one on MTW about the Queen’s p***y being so old it is haunted, are offensive on so many grounds you hardly know where to begin. Little Britain made its name by being ageist, sexist and offensive to the disabled, rural gays and the people of Wales.
This is beyond a joke. There is a very real danger that satire, irony and other forms of comic abuse are now going to be driven from our screens because of the theoretical possibility that some minority group might be offended. Is the word “chav” offensive to single parents living on housing estates? I don’t like it myself, and don’t use it - but my children do, and so do travel companies who offer “chav-free holidays”. “Redneck” is a term of abuse used against truckers and poor rural whites in the southern states of America. Songs like “Short People” by Randy Newman can surely no longer be broadcast on the BBC; and terms like “one-armed bandit” must now be proscribed. Should Gullivers Travels be banned for its misrepresentation of smaller people?
Laughter is a serious business. The right to be offensive is an important part of our political culture, and was only won after a long struggle against laws on seditious libel. But can cartoonists like Steve Bell of the Guardian and Martin Rowson continue depicting politicians as rotting meat or gibbering morons? The former leader of the Liberal Democrats, Sir Menzies Campbell, was driven from office because cartoonists portrayed him as a corpse propped up by a zimmer frame. That’s surely ageist. It may not be possible to depict Barack Obama at all except as a secular saint because anything offensive might be interpreted as racist. Imagine if Steve Bell were to depict Obama as a chimpanzee in the way he has President George Bush? Or as a criminal, or a vampire or a lunatic, foaming at the mouth.
Freedom of speech is under enough threat in this country from official secrecy, defamation laws, anti-terrorist statutes without overlaying it with excessive sensitivity to minorities. And no, I’m not ranting about ‘political correctness gone mad’ - we are right to cleanse our language of racial abuse. But in our zeal to avoid hateful imagery we must not believe we can police other peoples’ thoughts. I’m sorry, but Carol Thatcher should never have been sacked for whatever she may or may not have said in a private conversation over a glass of wine in the BBC green room - and I speak as someone who has heard many profoundly offensive remarks being made on BBC premises. I am dismayed to see liberal commentators claiming it is acceptable for anyone, even Mrs Thatcher’s daughter, to lose their job because of a private conversation. I am as opposed to racial prejudice as anyone alive, and I might have taken issue with her had she compared a tennis player to a Gollywog in my presence. But I would never have gone telling tales. What were these people thinking of?
In every newsroom in the land there is an undercurrent of banter, much of it sexist, racist or sectarian. In BBC Scotland, whenever there was an old firm game on, the air would fill with jokey remarks about blue noses and papists. Are those who said these things now to be sacked? Should I be naming names? The late Kenny MacIntyre was one of the funniest and most humane journalists BBC Scotland ever produced. As was the butt of much of his humour, the late travel reporter and curry connoisseur Ali Abassi. They spent much of their time hurling hyperbolic abuse at each other much of which, out of context, could have been construed as racist or offensive to crofters and sheep. Yet in their relationship you saw the true image of racial tolerance in Scotland. What if someone reported them?
The surest way to drive a wedge between communities is to try to police what people think and what they say in private. That way lies only intolerance and hate. Now, have you heard the one about the Scotsman, the Irishman and the Englishman....
Further I would like to apologise to the bedroom community for any pain and distress caused by a comparison with the Prime Minister’s state of dress. Finally, may I apologise to Gordon Brown, who has himself the target of hate speak from the Gauleiter of the Top Gear Nazi Party, Herr Jeremy Clarkson, and who is in no way untidily dressed, exhausted, not looking 100% or any of the other things I may or may not have said. And while I’m at it, let me issue a prophylactic apology to Britain’s petrol heads for comparing the presenter of their favourite television programme to a member of the far right.
Sadly, I’m only half joking here. I’m really not sure what is acceptable to say any more, in public or private, after this astonishing week in which Orwellian thought crime became a potent reality in the British media. A kind of madness has infected the country - an incomprehensibe witch-hunt for petty offence. I’m no apologist for Jeremy Clarkson, but I don't believe Scots are racially offended by his description of the Prime Minister as a “one-eyed Scottish idiot”? I’m Scottish and I’m not offended, and I don’t need to be defended from people like Clarkson by self-appointed cultural guardians or rent-a-quote politicians. I’m frequently called an idiot myself and I refuse to take offence at the description.
If calling someone Scottish or English or an idiot or one-eyed is to be outlawed then a lot of books are going to have to be burnt and most Scottish comedians will be joining the dole queues. The Declaration of Arbroath will have to be banned as will the National Anthem with its talk of crushing rebellious Scots. Programmes like Mock the Week and Have I Got News For You are toast. I’m a republican, but I can see that jokes, such as the one on MTW about the Queen’s p***y being so old it is haunted, are offensive on so many grounds you hardly know where to begin. Little Britain made its name by being ageist, sexist and offensive to the disabled, rural gays and the people of Wales.
This is beyond a joke. There is a very real danger that satire, irony and other forms of comic abuse are now going to be driven from our screens because of the theoretical possibility that some minority group might be offended. Is the word “chav” offensive to single parents living on housing estates? I don’t like it myself, and don’t use it - but my children do, and so do travel companies who offer “chav-free holidays”. “Redneck” is a term of abuse used against truckers and poor rural whites in the southern states of America. Songs like “Short People” by Randy Newman can surely no longer be broadcast on the BBC; and terms like “one-armed bandit” must now be proscribed. Should Gullivers Travels be banned for its misrepresentation of smaller people?
Laughter is a serious business. The right to be offensive is an important part of our political culture, and was only won after a long struggle against laws on seditious libel. But can cartoonists like Steve Bell of the Guardian and Martin Rowson continue depicting politicians as rotting meat or gibbering morons? The former leader of the Liberal Democrats, Sir Menzies Campbell, was driven from office because cartoonists portrayed him as a corpse propped up by a zimmer frame. That’s surely ageist. It may not be possible to depict Barack Obama at all except as a secular saint because anything offensive might be interpreted as racist. Imagine if Steve Bell were to depict Obama as a chimpanzee in the way he has President George Bush? Or as a criminal, or a vampire or a lunatic, foaming at the mouth.
Freedom of speech is under enough threat in this country from official secrecy, defamation laws, anti-terrorist statutes without overlaying it with excessive sensitivity to minorities. And no, I’m not ranting about ‘political correctness gone mad’ - we are right to cleanse our language of racial abuse. But in our zeal to avoid hateful imagery we must not believe we can police other peoples’ thoughts. I’m sorry, but Carol Thatcher should never have been sacked for whatever she may or may not have said in a private conversation over a glass of wine in the BBC green room - and I speak as someone who has heard many profoundly offensive remarks being made on BBC premises. I am dismayed to see liberal commentators claiming it is acceptable for anyone, even Mrs Thatcher’s daughter, to lose their job because of a private conversation. I am as opposed to racial prejudice as anyone alive, and I might have taken issue with her had she compared a tennis player to a Gollywog in my presence. But I would never have gone telling tales. What were these people thinking of?
In every newsroom in the land there is an undercurrent of banter, much of it sexist, racist or sectarian. In BBC Scotland, whenever there was an old firm game on, the air would fill with jokey remarks about blue noses and papists. Are those who said these things now to be sacked? Should I be naming names? The late Kenny MacIntyre was one of the funniest and most humane journalists BBC Scotland ever produced. As was the butt of much of his humour, the late travel reporter and curry connoisseur Ali Abassi. They spent much of their time hurling hyperbolic abuse at each other much of which, out of context, could have been construed as racist or offensive to crofters and sheep. Yet in their relationship you saw the true image of racial tolerance in Scotland. What if someone reported them?
The surest way to drive a wedge between communities is to try to police what people think and what they say in private. That way lies only intolerance and hate. Now, have you heard the one about the Scotsman, the Irishman and the Englishman....
Monday, February 02, 2009
British jobs for British workers
You can tell a lot about a country by what bring its citizens out on the streets. In France, millions demonstrated last week against banking bailouts and public money being used to prop up a failed financial system built on greed. Here in Britain we go on strike against foreign workers.
I say ‘we’ when of course it is only a relatively small number of workers who have been involved in wildcat strike actions against the importation of Italian and Portuguese workers to the Lindsey oil refinery in North Lincolnshire. But they are mostly in key positions, in power stations and energy plants, and able to make a disproportionate impact on the economy. There are plans this week to shut down filling stations owned by Total, the French company which has imported the workers at Lindsey. Shades of the fuel protests in 2000 which a handful of hauliers and refinery staff brought the country to a standstill.
Workers in Longannet and Cockenzie power stations in Scotland have been active in the strike, though none of their jobs are remotely at risk from immigrants, and there are plans this week to organise an Edinburgh-to-London march against foreign workers. What a grim commentary on the state of industrial politics in modern Britain. In the 1930s, the Jarrow Crusade marched on London to demand work; now in 2009 they will be marching to demand that foreigners are sent home. The British National Party is finally in from the cold - inheritor of the great tradition of British industrial militancy.
It’s not that I don’t have a measure of sympathy with the strikers. It’s easy for politicians and middle class newspaper columnists to accuse workers of xenophobia (a polite word for ‘racism’) when they aren’t facing a similar threat to their jobs. If a barge loaded with Italian politicians were to tie up outside Westminster offering to do MPs’ jobs for less money I suspect we would discover overnight that this was an act of industrial warfare which threatened Britain’s economic livelihood, culture and way of life. MPs and Peers would be linking arms in New Palace Yard to prevent any of them entering the building. Though it’s unlikely there would be a wave of sympathy actions from other workers across the land.
But there are so many better reasons to take to the streets right now than over a handful of European workers in Grimsby who are here entirely legally. As countless billions of taxpayers’ money is handed to the private banks, why is no one demonstrating against socialism for the rich? Why are there no barricades in Downing Street to protest at the government’s monumental incompetence - a decade of policies which have run down manufacturing industry in order to turn Britain into a casino economy based on financial speculation? Why are people not marching down Threadneedle Street, demanding the head of the Governor of the Bank of England for doubling the national debt and printing money in order to bail out delinquent banks which can’t be trusted to manage an honest deposit account let alone the wealth of the nation?
Why not a demonstration against foreign tax havens, which are allowing British companies to evade a hundred billion in taxation? Why not demonstrate against the insurance companies whose dabbling in derivatives has helped destroy the pensions of the very same workers who are taking to the streets against immigrants? Why is it that, in Britain, it is foreigners who are the first to be prime target?
Gangs of foreign workers have been coming here ever since the Irish navigators were imported to dig the canals two hundred years. And immigration is a two way street: the long-running TV series “Aufwiedersehen Pet” was about British workers going to work in Germany on similar terms to the Italian workers in Lincolnshire. There is generally an element of social dumping when workers are shipped abroad - of firms undercutting local labour prices. But in Lindsey, the firm in charge, Total, insists there have been no local redundancies as a result of their sub-contractors, IREM bringing their own staff. Nor, they insist, are the Italian workers being paid less than the British ones - though no one has been able to verify this. No, there is something deeply troubling about the way this local dispute has grown into a rolling national strike of more privileged workers condemning all foreign workers.
There is a latent xenophobia in British society at all levels, but it requires political leadership to bring it out. And that is the most serious charge against Gordon Brown. He has made the British National Party respectable by borrowing its slogan of “a British job for every British worker” - and I don’t believe for a nano-second that a politician as seasoned and sophisticated as the PM didn’t realise the full significance of these words. Labour has been blowing the immigration dog whistle for the last two years, promising to give British families priority in housing, promising to withhold benefits from foreign workers, when most aren’t entitled to them in the first place. Labour has adopted largely the same immigration controls that the Tories advocated in 2005. By subtly appealing to economic nationalism in this way, the government has legitimised actions that set worker against worker. Now the entire strategy has blown up in his face.
Yes, I know that British workers are losing their jobs by the hundreds of thousands, and that unemployment is likely to reach 3.1 million later this year - almost exactly the same as the number of foreign-born workers. Gordon Brown has encouraged mass immigration, along with “flexible” labour policies, in order to drive down the wages and living standards of UK workers in the hope of attracting foreign investment. But that isn’t the fault of the employees who come here.
The British workers holding meetings today to plan the next stage of their campaign should pause and reflect. Do they really think it would be any better if immigrant workers were all sent home? Most public services would collapse. Those taking to the streets are relatively well paid and wouldn’t dream of working in a hospital for £14,000 a year. Perhaps the trades unionists among them should dig out their copies of that great socialist novel, “The Ragged Trousered Philanthropists” by Robert Tressell to see how hostility to foreign workers was exploited by employers a hundred years ago. Plus ca change....
I say ‘we’ when of course it is only a relatively small number of workers who have been involved in wildcat strike actions against the importation of Italian and Portuguese workers to the Lindsey oil refinery in North Lincolnshire. But they are mostly in key positions, in power stations and energy plants, and able to make a disproportionate impact on the economy. There are plans this week to shut down filling stations owned by Total, the French company which has imported the workers at Lindsey. Shades of the fuel protests in 2000 which a handful of hauliers and refinery staff brought the country to a standstill.
Workers in Longannet and Cockenzie power stations in Scotland have been active in the strike, though none of their jobs are remotely at risk from immigrants, and there are plans this week to organise an Edinburgh-to-London march against foreign workers. What a grim commentary on the state of industrial politics in modern Britain. In the 1930s, the Jarrow Crusade marched on London to demand work; now in 2009 they will be marching to demand that foreigners are sent home. The British National Party is finally in from the cold - inheritor of the great tradition of British industrial militancy.
It’s not that I don’t have a measure of sympathy with the strikers. It’s easy for politicians and middle class newspaper columnists to accuse workers of xenophobia (a polite word for ‘racism’) when they aren’t facing a similar threat to their jobs. If a barge loaded with Italian politicians were to tie up outside Westminster offering to do MPs’ jobs for less money I suspect we would discover overnight that this was an act of industrial warfare which threatened Britain’s economic livelihood, culture and way of life. MPs and Peers would be linking arms in New Palace Yard to prevent any of them entering the building. Though it’s unlikely there would be a wave of sympathy actions from other workers across the land.
But there are so many better reasons to take to the streets right now than over a handful of European workers in Grimsby who are here entirely legally. As countless billions of taxpayers’ money is handed to the private banks, why is no one demonstrating against socialism for the rich? Why are there no barricades in Downing Street to protest at the government’s monumental incompetence - a decade of policies which have run down manufacturing industry in order to turn Britain into a casino economy based on financial speculation? Why are people not marching down Threadneedle Street, demanding the head of the Governor of the Bank of England for doubling the national debt and printing money in order to bail out delinquent banks which can’t be trusted to manage an honest deposit account let alone the wealth of the nation?
Why not a demonstration against foreign tax havens, which are allowing British companies to evade a hundred billion in taxation? Why not demonstrate against the insurance companies whose dabbling in derivatives has helped destroy the pensions of the very same workers who are taking to the streets against immigrants? Why is it that, in Britain, it is foreigners who are the first to be prime target?
Gangs of foreign workers have been coming here ever since the Irish navigators were imported to dig the canals two hundred years. And immigration is a two way street: the long-running TV series “Aufwiedersehen Pet” was about British workers going to work in Germany on similar terms to the Italian workers in Lincolnshire. There is generally an element of social dumping when workers are shipped abroad - of firms undercutting local labour prices. But in Lindsey, the firm in charge, Total, insists there have been no local redundancies as a result of their sub-contractors, IREM bringing their own staff. Nor, they insist, are the Italian workers being paid less than the British ones - though no one has been able to verify this. No, there is something deeply troubling about the way this local dispute has grown into a rolling national strike of more privileged workers condemning all foreign workers.
There is a latent xenophobia in British society at all levels, but it requires political leadership to bring it out. And that is the most serious charge against Gordon Brown. He has made the British National Party respectable by borrowing its slogan of “a British job for every British worker” - and I don’t believe for a nano-second that a politician as seasoned and sophisticated as the PM didn’t realise the full significance of these words. Labour has been blowing the immigration dog whistle for the last two years, promising to give British families priority in housing, promising to withhold benefits from foreign workers, when most aren’t entitled to them in the first place. Labour has adopted largely the same immigration controls that the Tories advocated in 2005. By subtly appealing to economic nationalism in this way, the government has legitimised actions that set worker against worker. Now the entire strategy has blown up in his face.
Yes, I know that British workers are losing their jobs by the hundreds of thousands, and that unemployment is likely to reach 3.1 million later this year - almost exactly the same as the number of foreign-born workers. Gordon Brown has encouraged mass immigration, along with “flexible” labour policies, in order to drive down the wages and living standards of UK workers in the hope of attracting foreign investment. But that isn’t the fault of the employees who come here.
The British workers holding meetings today to plan the next stage of their campaign should pause and reflect. Do they really think it would be any better if immigrant workers were all sent home? Most public services would collapse. Those taking to the streets are relatively well paid and wouldn’t dream of working in a hospital for £14,000 a year. Perhaps the trades unionists among them should dig out their copies of that great socialist novel, “The Ragged Trousered Philanthropists” by Robert Tressell to see how hostility to foreign workers was exploited by employers a hundred years ago. Plus ca change....
Subscribe to:
Posts (Atom)
